Oracle Corp. President Safra Catz met with European Union Competition Commissioner Neelie Kroes today in an unsuccessful effort to break the logjam holding up her company’s acquisition of Sun Microsystems, the commission reported today.
The meeting follows by a day news that Sun plans to lay off as many as 3,000 workers, or 10% of its workforce, over the next 12 months in the face of the delays in Oracle’s takeover.
In an 8-K filing with the Securities and Exchange Commission Tuesday, Sun, a purveyor of the MySQL open source database technology, the Java programming language, the Solaris operating system, servers, and other technology, cited the acquisition delay in its decision to restructure the company. Sun said it “expects to incur charges ranging from $75 million to $125 million over the next several quarters in connection with the restructuring plan, the majority of which relates to cash severance costs.”
The personnel cuts will take place “across the North America, EMEA, APAC, and emerging markets regions,” according to Sun’s filing.
Since April, when Oracle and Sun struck their $7.4 billion cash deal, the path to completion has been fraught with obstacles.
In May, Sun filed documents with the SEC disclosing possible violations of the U.S. Foreign Corrupt Practices Act and three shareholder class-action suits alleging that Oracle’s offer for Sun was “unfair and inadequate.”
In June, the Justice Department announced that it required an extension beyond the usual 30 days to review the deal. According to an Oracle statement, the DOJ was looking at issues pertaining to the licensing of Sun’s Java software-related products.
The Justice Dept. gave the deal the green light in August, a month after Sun stockholders approved the acquisition.
But the European Commission had yet to weigh in.
In September, the EC said it would take as much as four months — it set a Jan. 19, 2010 deadline — to review the implications of the match-up before it could rule on the deal. Regulators expressed concern about possible anti-competitive fallout because Oracle would own Sun’s MySQL database, which is an open source competitor to Oracle’s proprietary offerings.