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PeopleSoft Seals J.D. Edwards Deal

PeopleSoft Friday officially closed its acquisition of J.D. Edwards , purchasing the remaining shares of the Denver-based software maker in its bid to compete better at the mid-market applications level.

Pleasanton, Calif.'s, PeopleSoft, in the midst of the struggle for its life to fend off a hostile merger attempt by applications rival Oracle , initially purchased about 110 million shares, or 88 percent of J.D. Edwards' shares July 17. On Friday, the company bought the remaining shares for $7.05 in cash plus 0.43 of a share of PeopleSoft common stock.

Technically, owning 90 percent of a company's shares means the company is in the acquirer's control, but PeopleSoft said in July that the purchase of the two percent needed to claim title of majority owner was a foregone conclusion. Analysts agreed.

"It's not a question of if, but when," PeopleSoft spokesperson Steve Swasey said July 18. PeopleSoft "owns the company, we're in integration mode, which we formally started this morning." Fractional shares will be paid in cash.

PeopleSoft President and CEO Craig Conway issued a brief statement about the completed deal.

"Over the last month we have moved rapidly to integrate the two companies," said Conway. "During that time, customer response has been outstanding and employees have been energized. I am more confident than ever that this combination will result in enhanced value for shareholders."

The purchase cements the fact that Oracle's hostile takeover bid will be $1.7 billion more expensive than its standing $6.3 billion bid -- to digest the combined PeopleSoft/J.D.Edwards entity. Redwood Shores, Calif. has said repeatedly that this would not deter it from going forward with its aggressive maneuver.

Oracle has planned its second "town hall" meeting for next week to field questions from concerned customers. Oracle Executive Vice Presidents Chuck Phillips and Mike Rocha will host the live event. The meeting will focus on its planned enhancements to PeopleSoft customer support and elaborate on the mechanics for a smooth support transition.