EU investigation to delay Peoplesoft bid

US antitrust officials may wait until January to weigh in on Oracle's embattled bid to acquire PeopleSoft, and European regulators are likely to initiate a more in-depth review of the deal, an Oracle executive has admitted.

Oracle Executive VP Chuck Phillips said in an interview with CNET News.com that the US Department of Justice is taking longer than expected in its examination of the $7.25bn unsolicited bid and may not issue a ruling until December or January. Oracle said previously that it hoped the Justice Department would conclude its review sometime this month.

Phillips said: "It's taking more time. They need more information. It's in our interest to give them every bit of data they need."

Oracle's bid hinges, for now, on clearing antitrust reviews. In July, the Justice Department began an extended inquiry into the deal, which would combine the second- and third-largest business applications companies in the world. The largest is SAP, a German rival.

The European Commission began its initial review of the deal last month. The commission set a provisional deadline to either make a decision or begin an "in-depth second phase" by Monday. A longer review could take up to four months.

Phillips expects the European Commission to take the latter route in order to coordinate with the Justice Department on a decision. "We'd be surprised if the EU didn't require more time," he said.

Recent media reports suggesting that the Justice Department is building a case against the deal are mere speculation, Phillips said. "It's understandable people are going to speculate," Phillips said.

"We think we've made a pretty strong case, and the facts support us pretty well. We think the odds are in our favour," he said.

But according to some antitrust attorneys, a Justice Department challenge is likely given that it would reduce competition among software vendors that serve very large companies.

"Although SAP has a huge market share lead, the issue is not whether this deal would create a monopoly," said a former high-level Justice Department antitrust attorney in the Clinton administration. "The question is, if PeopleSoft and Oracle merge, will it raise prices, even incrementally, and make them stick for some time."

Alorie Gilbert and Dawn Kawamoto write for CNET News.com, Charles Cooper contributed to this report