Oracle’s acquisition of Sun rejected by EU

After investigating this year’s most talked about acquisition, the European Commission has concluded Oracle buying Sun would be anti-competitive.

EU flag

The European Commission (EC) has officially objected to Oracle's $7.4 billion (4.4 billion) acquisition of Sun Microsystems.

According to a Securities and Exchange Commission filing from Sun, the EU has presented the companies with a statement of objections to the proposed deal.

"The Statement of Objections sets out the Commission's preliminary assessment regarding, and is limited to, the combination of Sun's open source MySQL database product with Oracle's enterprise database products and its potential negative effects on competition in the market for database products," says Sun in the filing.

Oracle immediately fired back at the EC, claiming the decision "reveals a profound misunderstanding of both database competition and open source dynamics."

"It is well understood by those knowledgeable about open source software that because MySQL is open source, it cannot be controlled by anyone. That is the whole point of open source," the statement said.

"The database market is intensely competitive with at least eight strong players, including IBM, Microsoft, Sybase and three distinct open source vendors. Oracle and MySQL are very different database products. There is no basis in European law for objecting to a merger of two among eight firms selling differentiated products."

Oracle pointed to the US Department of Justice's (DoJ) decision to pass the deal as evidence of its point. The DoJ swiftly released its own statement on the matter.

"After conducting a careful investigation of the proposed transaction between Oracle and Sun, the Department's Antitrust Division concluded that the merger is unlikely to be anticompetitive," said the DoJ.

"At this point in its process, it appears that the EC holds a different view. We remain hopeful that the parties and the EC will reach a speedy resolution that benefits consumers in the Commission's jurisdiction," it concludes.

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