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Arriving just two weeks after International Business Machines (IBM) pulled the plug on an acquisition deal for Sun Microsystems that many in the tech industry believed was a done deal, Sun has now been snapped up by enterprise software maker Oracle Corporation.
Oracle secures Sun for $7.1 billion USD. Image: tehduh/Flickr.
Moving quickly after IBM and Sun hit an abrupt pricing value impasse, Redwood-based Oracle has hammered out a deal that will see it handing over a total of $7.1 billion USD for Santa Clara-based Sun, which is perhaps best known for creating Java and Open Office.
A Reuters report outlines that sources closely aligned with the surprise purchase have said the two parties opened discussions on Thursday, April 16. Oracle’s subsequent acquisition offer equates to $9.50 USD per share, which slightly improves upon IBM’s final rebuffed offer for Sun, which reached as high as $9.40 USD per share.
According to Oracle president Safra Catz, the acquisition of Sun will add a minimum of $0.15 USD per share to Oracle’s earnings in the first full year after closure, along with $1.5 billion USD in first year operating profits.
Shares of Sun Microsystems leapt by 36 percent to $9.11 USD on news of the takeover, while pre-market trading saw shares in Oracle drop by almost five percent to $18.34 USD.
The takeover deal is expected to be finalised, according to shareholder and regulatory approval, before the end of the summer.
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