BEA Again Rebuffs Oracle Offer

Oct 26, 04:22 PM

Current Headlines: By Pete Carey, San Jose Mercury News, Calif.

Oct. 26--BEA SYSTEMS -- eyeball to eyeball with Oracle's Larry Ellison -- repeated this morning that Oracle's $17 a share offer is "unacceptable."

In a letter faxed to Oracle, the San Jose computer middleware company's board of directors also indicated that it is unfazed by Oracle's warning that its offer expires on Sunday.

BEA's board said it "cannot endorse a proposal that it has concluded significantly undervalues BEA. We therefore assume that your proposal will expire on October 28."

The San Jose company's stock drifted below $17 a share in early trading, a signal that traders consider a deal at that price increasingly dubious.

Some analysts have speculated that Oracle might withdraw its offer and renew it later on.

Oracle dismissed BEA's counterproposal of $21 a share Thursday, calling it an "impossibly high price" and "a perfect strategy" if BEA wants to remain independent.

BEA has been under pressure from activist investor Carl Icahn to sell. Icahn is now BEA's major shareholder, with more than 13 percent of its shares.

In its letter to Oracle President Charles Phillips, BEA's directors wrote that, "As we have stated repeatedly, your $17.00 per share proposal is unacceptable to the Board of Directors of BEA Systems."

Contact Pete Carey at (408) 920-5419 or pcarey@mercurynews.com.

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