One of the many reasons why most companies fails to sustain its presence in the market is due to lack or slow anticipation on future issues. Issues that sometimes could easily anticipate through research studies as well as performing alternative actions towards it.Acquisition of new company by another company is one good example in the current business trend. The main reason here is that those companies that has been acquired develops an understanding that their company has already faced difficulty to compete and instead of continuing to compete, what happen is that they sell their business to others and form a new one or develop new business opportunities of their own.
This is one strategy that will be the main focus in this paper, which is how Oracle acquired PeopleSoft. For Oracle, as one big name in the IT business world, it has created an opportunity for the company that has given them an increase market share and at the same time has created new product offering to its global customers.In this paper, it will also provide some financial theories that were applied as well as how it has benefited bother parties particularly Oracle. Leadership and management transactions applied, valuation strategies and even financial methods used.
This paper also provides qualitative and quantitative measures applied during the acquisition process. And, lastly, evaluation of the organization after the acquisition, like the use misuse of the financial theory and risk analysis that affects the transaction.I. Processes applied or enacted to complete the strategy and also identification of keyLeadership and management transactions.PeopleSoft who has been one time the 2nd top earning enterprise development company in the world.
This has been a major leap in the IT global market for Oracle, not only it creates big challenge for Oracle to offer new product under its name but more importantly, it also gives the company new and promising opportunities for Oracle. As in most cases like in this kind of takeover or acquisition process, the very first part of its process was to address the legislative responses and processes between the two companies.As based from the 1986 Congress which enacted the William Act, which mainly use to remedy tender offer abuse by all parties involved in the acquisition process.This mainly protects the respective stakeholders in order to achieve both profitable transactions. In this act also, which both parties have applied ensures that both parties also provides and accomplish all the legal and business documents that will be required for the transaction. (Brown, M.
, Brown, R., Bird, P., Kubek, G. & Regner W., 2004, pp.
5-7).With these processes that were applied by both parties, particularly for Oracle, it will make Oracle the second largest seller of business applications in the world behind SAP AG. For the leadership and management team for Oracle, this strategy obviously is an action that they need to take to compete at the higher level which is the growing trend in the IT business world. Leadership as well as management approach that were applied was directly attack the market and dominate the competition.But this was not easy as the US Government, particularly the US Antitrust regulators which was said that it could create major market move like increase in prices and unhealthy competition.
But, still Oracle was so determined and aggressiveness by the management and the leadership team comes true with the plan and acquisition was still accomplished.
