Larry Ellison's Victory Dance

It's been a good year for Oracle (Nasdaq: ORCL  ) CEO Larry Ellison. In all, Oracle posted breathtaking earnings gains, beat a Justice Department lawsuit, forced the firing of a key rival, and finally acquired business software maker PeopleSoft (Nasdaq: PSFT  ) . And you thought you were busy.

The biggest coup of the year was the PeopleSoft deal, naturally. Though it hasn't yet closed, yesterday Oracle announced that it had enough PeopleSoft shares -- 75% of the total outstanding -- to take preliminary control of the business. The news came on the heels of the resignation of PeopleSoft founder Dave Duffield.

Duffield's resignation began the corporate makeover now under way at PeopleSoft. Four of the company's other directors have resigned, to be replaced by senior Oracle executives during the transition to what I've come to call OracleSoft. Of course, none of PeopleSoft's managers will walk away empty-handed. Duffield, for example, had more than 18 million shares at the time of a Nov. 30 report, according to Yahoo! Finance. At $26.50 per share, that's a $500 million payday. Just in time for the holidays, too.

In a statement published yesterday, Ellison seemed filled with the joy of the season, proclaiming that he was bringing together some of the best people in the enterprise applications software market "for the benefit of the customer." He also said that the early work on integrating the companies is going well. Yeah, OK. The fact is that Oracle can't officially take control until at least 90% of PeopleSoft's shares have been tendered. But the database king remains undaunted, confidently extending the deadline for shareholders to sell to next Tuesday.

Is all this posturing really anything more than a symbolic victory dance by Ellison? Probably not, but who cares? Look again at that list of accomplishments. What's truly remarkable is that the gloating isn't likely to do anything to boost expectations for Oracle in 2005. That may be because there are doubts that the cultural divide between Oracle and PeopleSoft can be bridged. But that's a dangerous bet against an executive who has not only committed to spend $10.3 billion in cash but who has also proved indomitable for virtually the entire history of Silicon Valley.

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Fool contributor Tim Beyers owns shares of Oracle. You can view his Fool profile and other stock holdings here.

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