Oracle offer fading as BEA hits out at Ichan

After letting Oracle's $17 (8.25) per share offer expire last Sunday, BEA has now issued a letter responding to the legal attempts of its largest shareholder, billionaire Carl Ichan, to force a vote on the bid.

Oracle had given the middleware vendor until 28 October to accept its $6.7 billion (3.3 billion) offer. When the deadline passed with no response, Oracle issued a terse statement, but its wording did not rule out its interest in acquiring BEA.

"The BEA shareholders should not assume that Oracle will renew its $17 per share offer in the future," it said. "Over time many things can change: BEA's business might materially weaken, the stock market can fall further from its recent record highs, or Oracle may have committed its capital elsewhere."

In rejecting the offer, BEA stuck to its assertion that the company was worth more than Oracle was offering. But its rejection of the bid and naming of a price that, at $21 (10.19) per share, values the company at $8.3 billion (4.03 billion) has prompted its largest shareholder and billionaire, Carl Ichan to take it to court.

Ichan, who hold over 58 million shares of BEA stock, last week filed a suit with a Delaware court to force an annual shareholder meeting and vote on the possibility of acquisition. He said in a statement that the vote was necessary "before any scorched earth transactions (such as stock issuances, asset sales, acquisitions or similar occurrences) take place at BEA, other than transactions that are approved by shareholders".

BEA yesterday issued this statement in response to Ichan: "The Board and management of BEA Systems are not opposed to an acquisition of the company. In fact, we are currently exploring ways to maximise shareholder value, including the possible sale of the company."

Although BEA has said it's not opposed to a sale at the right price, Ichan countered by saying an auction sale was the only BEA could avoid the litigation.