NetSuite became part of Oracle on Monday after the
$9.3 billion deal, or $109 per share that Oracle initially offered for Netsuite, officially closed.
As we predicted, the drama between Oracle and a major NetSuite shareholder T. Rowe Price ultimately went nowhere. T. Rowe Price had been pushing Oracle to cough up a lot more money to buy NetSuite, arguing that Oracle’s executive chairman and CTO Larry Ellison had a conflict-of-interest that stopped NetSuite from getting alternative bids and top dollar.
Oracle basically told T. Rowe Price to get lost. Oracle said it wasn’t going to pay more for NetSuite, a financial cloud software company that Ellison c0-founded and still mostly owned prior to the sale. T. Rowe had about a 13% stake, the second largest stake after Ellison’s.
Ellison had abstained from the shareholder vote, meaning that a majority of the remaining independent shareholders had to agree with the sale and tender their shares.
But with T. Rowe fighting the deal, those independent shareholders were hanging out, hoping Oracle would cave and offer more. Instead, Oracle issued a take-it-or-leave it offer deadline of Friday at midnight.
A majority of the shareholders smartly took the offer. Given Ellison’s ownership of the company, it was highly unlikely that NetSuite would ever have found a bidder willing to pay more.
And if the deal hadn’t gone through, NetSuite would have found itself increasingly competing with Oracle, which now has its own, homegrown financial software cloud. Oracle certainly wants NetSuite’s customers and revenue, but the deal was as much an escape route for NetSuite as anything.
The biggest winner of it all: Larry Ellison, the world’s fifth richest man. His roughly 40% stake in NetSuite means he’ll get a payday of about $3.5 billion cash, according to documents filed with the SEC.
Another winner is NetSuite co-founder, CTO and chairman of the board Evan Goldberg, who walks with about $240 million.
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