The acquisition-hungry software giant is taking inventive steps to secure a ready supply of credit amid turmoil in the financial markets. This will fund its appetite for deals.
Last year, Oracle agreed to pay roughly US$8.5 billion for BEA. The money raised by its note offering will help finance that deal, although given's its healthy cash pile Oracle will have money left over to fund further deals. Its last set of quarterly financials, released on 26 March, suggest Oracle has around US$8.4 billion in cash.
Oracle will issue a range of notes, with a total value of US$5 billion, including: US$1.25 billion of 4.95 percent Notes due 2013; US$2.50 billion of 5.75 percent Notes due 2018; US$1.25 billion of 6.50 percent Notes due 2038.
It has already entered into a US$2 billion, unsecured 364-day revolving credit agreement, with lenders such as Wachovia and Bank of America to provide it with working capital for deals.
The note offer is expected to close on 9 April.
Oracle bolsters acquisition war chest
By IT Week on Apr 7, 2008 7:49AM