Sun Microsystems losing $100 mn a month: Oracle

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CALIFORNIA: Oracle Corp Chief Executive Larry Ellison said Sun Microsystems Inc is losing about $100 million a month as European regulators delay approving his company's $7 billion purchase of the struggling hardware maker.

Ellison also said it would not be necessary for Oracle to divest Sun's MySQL database software business to satisfy European regulators who have expressed concerns about his company's ownership of the unit.

"We're not going to spin it off," Ellison said in response to a question during a dinner at one of Silicon Valley's most prominent speaker's forums, the Churchill Club.

Ellison, the world's fourth-richest man according to Forbes, expects the deal will eventually be cleared by European regulators as it was in the United States, without any conditions.

The European Commission is conducting an in-depth probe into whether the competition would be stifled by the combination of Oracle's database, the world's top seller, and Sun's MySQL database, which is widely used to run popular websites.

"The longer this takes, the more money Sun is going to lose," Ellison said during the one-hour-plus on-stage interview conducted by Ed Zander, the former CEO of Motorola Corp and a former Sun executive.

Legal experts have said Oracle may need to make concessions, including the divestiture of the MySQL software business, and that it is unclear how long European approval would take.

Sun's revenue has tumbled since April when Oracle agreed to buy the world's No. 4 computer server maker in April as rivals IBM and Hewlett-Packard Co have poached customers amid uncertainty about its future.

Oracle has pledged to boost investment on development of Sun's products, but the hardware company has cut spending prior to the deal's closing as sales have plunged. Last month it reported a quarterly loss of $147 million.

European regulators have until January 19, the deadline set by the Commission, the competition watchdog of the 27-country European Union. That would put Oracle months behind its original plan for closing the deal by the end of August.

Speaking about broader economic trends, Ellison said conditions remain challenging and he did not foresee a rapid recovery.

When asked how much longer he expected to remain at the company he co-founded 32 years ago, Ellison said he intended to continue for at least another five years, though he did not specify in what role.




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