Oracle Makes Bid For Retek

Oracle late Tuesday said it plans to offer $9 a share for Retek in an effort to preempt the retail software company’s acquisition by rival SAP .

“Oracle’s applications business in North America is larger than SAP’s,” Oracle CEO Larry Ellison said in a statement. “We intend to defend our number one position.”

“The Retek customers I’ve talked to said they’d prefer that Oracle buy Retek,” Oracle President Charles Phillips added. “The vast majority of Retek customers already have a strong Oracle relationship.”

Oracle said it purchased 5.5 million shares of Retek common stock on Monday and Tuesday, representing nearly 10 percent of total shares outstanding.

“Oracle and Retek have been partners since 1986, providing systems to many of the world’s largest retailers, and in October 2004, Oracle and Retek began discussions about combining the two companies,” the Oracle statement said. “Most of Retek’s applications have been built on Oracle’s technology platform using Oracle’s development tools, and approximately 80 percent of Retek’s customers currently run Oracle’s infrastructure software.”

Oracle released a letter that the company delivered to Retek’s board of directors outlining the offer, which is about 6% more than SAP’s $496 million offer. Investors acted like they expected the price for Retek to go even higher, bidding the stock up to nearly $10 a share after hours.

Also after the close, Xilinx raised guidance, and WebMD reported results that were in line with expectations.

Stocks slumped during the day on rising oil prices and a warning from Texas Instruments .

The Nasdaq slumped 16 to 2073, the S&P 500 lost 5 to 1219, and the Dow fell 24 to 10,912. Volume rose to 1.52 billion shares on the NYSE, and declined to 1.74 billion on the Nasdaq. Decliners led 21-11 on the NYSE, and 20-10 edge on the Nasdaq. Downside volume was 70% on the NYSE, and 75% on the Nasdaq. New highs-new lows were 201-18 on the NYSE, and 98-59 on the Nasdaq.

Qualcomm fell 3% after the company said Paul Jacobs, the son of company founder Irwin Jacobs, will succeed his father as CEO. Irwin Jacobs will stay on as chairman. Qualcomm also hiked its dividend and announced a stock buyback.

GuruNet soared 23% on a deal with Google .

Seagate climbed 2% after the company raised earnings guidance.

Apple fell 5% on plans by Sony to launch a flash-based audio player.

Sonus fell 5% on a downgrade.

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