Sun shareholders look to block Oracle sale
Claim price is too cheap.
By Chris Kanaracus, IDG News Service | Published: 06:08, 11 May 2009
Sun shareholders are fiercely resisting the company's projected sale to Oracle. In the last month. there have been three separate lawsuits attempting to stop the sale, according to a filing to the Securities and Exchange Commission from Sun.
The suits, filed in California, name Sun, some of its officials and Oracle as defendants. All three actions are aimed at blocking the US$7.4(£4.9) billion sale, alleging the price tag is "unfair and inadequate." They also allege "claims for breach of fiduciary duty against the individual defendants and for aiding and abetting a breach of fiduciary duty against the corporate defendants," the filing states. The defendants have yet to file answers to the complaints.
Sun also said in the filing that it may have broken the US Foreign Corrupt Practices Act during fiscal 2009. The law is meant to stop companies from bribing foreign officials. Sun said it has started an independent probe into suspect activities in a "certain foreign country" and "took remedial action," as well as made a voluntary disclosure to US authorities.
Meanwhile, Sun has decided to put the brakes on an effort to consolidate its database infrastructure into a single global ERP system.
Sun has "experienced a number of challenges" during the project that have affected operations, according to the filing.
"During the next six months, we have decided to delay the implementation of the remaining phases of the project while we evaluate alternatives," Sun said.
A Sun spokeswoman said the company "intends to respond appropriately to the lawsuits" but otherwise declined comment.
An Oracle spokeswoman declined to comment on the suits, but provided a statementsaying that Sun had disclosed its potential violations of the FCPA prior to the acquisition agreement.
