Originally published: April 20, 2009
Last updated: April 20, 2009 - 9:30pm
Oracle announced a deal to buy Sun Microsystems for $7.4 billion, a surprise union of software and hardware companies that emerged following failed talks for International Business Machines to buy Sun. Oracle, which has been snapping up smaller software companies for several years, agreed to pay $9.50 a share for Sun. The companies valued the transaction at about $5.6 billion, excluding Sun's cash and debt.
Sun, whose server systems have long been sold along with Oracle's database software, was widely believed to need a bigger partner as it competes with giants such as IBM, Hewlett-Packard Co. and Dell Inc. Another much larger company, Cisco Systems Inc., also recently entered the server business. The Sun deal helps elevate Oracle into those ranks, giving the company the ability to sell hardware as well as more fully exploit some important Sun software -- notably the popular Java programming technology and Sun's Solaris operating systems.
Some analysts said they were stunned by the move, since Oracle has long left it to others to build computers while concentrating on the more-profitable software business. Last year, when it began offering a server integrated with its database software, it did so through an alliance with Hewlett-Packard.
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