Oracle buying BEA Systems in $8.5B deal

Oracle will pay more than $19 a share for BEA

Oracle Corp. has agreed to buy BEA Systems Inc. for around $8.5 billion, the companies announced on Wednesday.

Under the proposed deal, which has already been unanimously approved by BEA's board of directors, Oracle would pay $19.375 per share for BEA.

In more acquisition news, Sun Microsystems Inc. said it will pay $1 billion for Swedish software company MySQL, whose open-source database is used for some of the most widely visited Web sites in the world.

"The addition of BEA products and technology will significantly enhance and extend Oracle's Fusion middleware software suite," said Oracle CEO Larry Ellison in a statement. "Oracle Fusion middleware has an open 'hot-pluggable' architecture that allows customers the option of coupling BEA's WebLogic Java Server to virtually all the components of the Fusion software suite. That's just one example of how customers can choose among Oracle and BEA middleware products, knowing that those products will gracefully interoperate and be supported for years to come."

"BEA is a pioneer in middleware, and this combination recognizes the innovation and customer success the company has achieved. Our joint customers have consistently suggested this deal for more than three years," said Oracle President Charles Phillips.

In a separate letter to customers, Phillips sought to reassure BEA customers that they would be able to continue to use their BEA software without being forced to migrate to Oracle applications.

"After the closing, Oracle intends to preserve and enhance customers' investments in BEA products as Oracle has done with its other acquisitions, while Fusion Middleware will continue to be the center of Oracle's current and future middleware and applications strategy," he said. BEA customers can continue to use their existing BEA products or choose to use Oracle and BEA products as part of the ongoing evolution of Fusion Middleware, Phillips added.

"Either way, it will be the customer's choice," he said.

Phillips also said that the acquisition would accelerate innovation at the two companies. "Together, Oracle and BEA will provide a series of complementary middleware solutions, including identity management, business intelligence and performance management, enterprise content management, and vertical-specific technologies like a communications service delivery platform," he said.

The move follows efforts last year by Oracle to buy out BEA. The deal is expected to close by midyear.

Oracle expected to offer more details about the deal in a midmorning conference call with company officials.

Peter Sayer of the IDG News Service contributed to this report.

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