Oracle Corp. announced that it has reached a definitive agreement to acquire Sun Microsystems Inc. for $9.50 per share, or approximately $7.4 billion in cash. The deal was valued at $5.6 billion after factoring in Sun’s cash and debt.
Oracle predicted that the acquisition will be accretive to its earnings by $0.15 on a non-GAAP basis in the first full year after closing, which both companies expect will happen this summer, pending shareholder approval. Oracle also said that Sun will contribute more than $1.5 billion to non-GAAP operating profit in the first year, with that figure increasing to more than $2 billion in the second year.
Sun had recently spurned an offer from IBM of $9.40 per share, down from Big Blue’s initial offer of $10 per share.