Oracle's acquisition of Sun gets green light

 

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By Reuters

Posted on 21 Aug 2009 at 08:28

Oracle has won US antitrust approval to buy Sun, clearing a key hurdle in plans to close the $7.4 billion deal before the end of this month.

The deal cleared the US Justice Department with no restrictions, though it still needs rubber stamping by the European Commission. It is very rare for a deal to pass the scrutiny of one organisation and not another

US announced in June it had questions about Oracle's plans for licensing Sun's Java software, one of the world's most widely used computer languages. Since then, investors have been waiting to see how long that might delay the deal.

Analysts claim the delay has worked to the advantage of Sun's two chief rivals in the server market, IBM and HP. They have been courting Sun's customers during the past few months, trying to persuade them to change suppliers amid uncertainty about Oracle's plans for running the server business.

Until Oracle closes the acquisition, it cannot say much about its strategy for Sun's hardware division. Oracle expects to close the deal by 31 Aug.

Oracle agreed to buy Sun in April after the collapse of weeks of talks between the struggling hardware and software maker and IBM.

The deal gives Oracle's outspoken billionaire CEO, Larry Ellison, control of Sun's Java software and the Solaris operating system for Unix servers.

Ellison wants to build and sell Sun computers preloaded with Oracle software and tweak Java software so that it is easier to use on smartphones and netbook computers.