A US$8.5bn courtship

Oracle signed a definitive agreement to buy BEA for US$8.5bn -  US$19.375 per BEA share. BEA shares were trading at $15.58 before the offer.

The two have been courting for some time although Oracle walked away from a possible deal in October after saying it could not better its offer of $17 a share, whilst BEA had demanded as much as $21 a share. In the announcement, Oracle's Larry Ellison said, "BEA products will significantly enhance and extend Oracle's Fusion middleware software suite...customers can choose among Oracle and BEA's middleware products, knowing that those products will gracefully interoperate and be supported for years to come.". At US$19.375 per share, Oracle is paying $8.5bn for the middleware firm - or US$7.2bn once BEA's cash pile of US$1.3bn is removed from the equation.

So the middleware consolidation continues. Given Oracle's history this could mean the end of the Oracle Application Server, to be replaced by Oracle WebLogic. And the BEA suite of solutions which are quite far along means more consolidation, where Oracle will chuck out more of it's previoulsy acquired or homegrown product in preference for BEA's. Fusion may in all likelihood become a BEA suite.