Craig Conway, who until Friday was CEO of PeopleSoft Inc, testified yesterday that he sought to “vilify” Oracle Corp’s hostile takeover bid, and that he viewed the offer as primarily a means for Oracle to harm PeopleSoft’s business.
My strategy was to vilify the offer, Conway reportedly testified during the third day of a trial in which Oracle is attempting to force PeopleSoft to rescind its poison pill shareholder rights plan, a major obstacle to the merger going through.
Since Oracle launched its offer in June 2003, a move spurred by PeopleSoft’s acquisition of JD Edwards, Conway had characterized the deal as a way for Oracle to spread uncertainty to PeopleSoft’s sales pipeline.
We thought it was a destructive offer, Conway reportedly testified yesterday. He explained comments about not selling to Oracle at any price by saying: I meant that I did not feel that this offer, this type of offer, was going to be acceptable.
PeopleSoft’s sales have been feeling the pinch the whole time Oracle’s offer, with the uncertainty it brings to the PeopleSoft product line, has been on the table. PeopleSoft is expected to argue in court that this was Oracle’s primary motivation.
Oracle is currently offering $21 per share for PeopleSoft. Its offer, which has changed a number of times, has rarely represented a reasonable premium on PeopleSoft’s asking price, which perhaps adds substance to Conway’s argument.
Conway was fired in a surprise move Friday, after the PeopleSoft board expressed a lack of confidence in his ability to lead the company. Three senior executives including CFO Kevin Parker had reportedly refused to work with him any longer.
Another reason, which emerged in court Monday as PeopleSoft director Steven Goldby testified, were allegedly misleading comments about the effect Oracle’s bid was having on sales, made by Conway to analysts in a meeting a year ago.
I didn’t intentionally lie or intentionally deceive or intentionally mislead, Conway reportedly testified yesterday. His comments were cut from the transcript of the meeting filed with the Securities and Exchange Commission in September 2003.
PeopleSoft’s new management and the board are said to be more open to exploring a friendly deal with Oracle than Conway, who on several occasions has clashed on a personal level with his old boss at Oracle, CEO Larry Ellison.
Ellison made it personal by observing early in the battle that a key difference between Oracle’s takeover proposal and a proposal he claimed Conway made a year earlier was that under Conway’s plan, Conway would continue to run the business.
Conway has also called Oracle sociopathic, a remark often construed rightly or wrongly as a dig at his flamboyant former boss. He told the court yesterday that Ellison is well read in the conquests of, and compares himself to, Genghis Khan.
Ellison has also joked about shooting his opponent, whom he calls Craigy, if he were given a gun, one bullet, and a choice between shooting Conway and Conway’s dog.