That market is getting more competitive, however. Microsoft recently reassigned its top sales executive to spur expansion of its small and midsize business applications unit and hopes to transform its business solutions division into a $10bn unit. PeopleSoft chief financial officer Kevin Parker said the J.D. Edwards acquisition should help fend off the threat from Microsoft. "This puts us in a better position to compete with Microsoft and their Great Plains product," he said. But the promises may not all come true. For one thing, PeopleSoft may have paid too much for J.D. Edwards. The deal calls for each share of J.D. Edwards stock to be exchanged for 0.86 of a PeopleSoft share, valuing J.D. Edwards' stock at around $14.10 -- a 19 percent premium over the 30 May closing price of $11.81. CS First Boston analyst Gibboney Huske suggested PeopleSoft may not get its money's worth. "For the acquisition to (add) to PeopleSoft shareholder value, revenue synergies must be realised," Huske wrote in a note on Tuesday. "However we believe revenue synergies will be difficult to achieve given the limited integration of products and organisations initially envisioned by the company." Then there's the question of whether J.D. Edwards will help PeopleSoft beat out its main remaining rivals, SAP and Oracle. SAP, for its part, claimed it's not frightened by the acquisition news. "Given current economic conditions, SAP has been expecting a consolidation of the industry for some time," the company said in a statement. "SAP continues to gain market share and expects that momentum to continue as other players consolidate to try and remain competitive." As for Oracle, it let its money do the talking, all $5.1bn worth.
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