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Sun management stumbled on EU Oracle probe

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With US regulators in the bag, it must have seemed like just a matter of time before Oracle's planned $5.6bn purchase of Sun Microsystems would get European approval.

Such was the level of confidence, Oracle boasted in June it fully expected the deal would close "this summer" - putting that at the end of September in calendar terms.

That was according to an Oracle attorney in an official statement. The fact he suggested a date in an official communication from a company that's notoriously parsimonious with information was significant.

The European Union's decision to investigate the deal, then, not only surprised Oracle - it also appears to have wrong footed Sun's senior management team. Publicly.

Just one day before regulators said they'd investigate, one of Sun's three product group leaders - a top executive inside the company - convened a special "all hands" meeting to re-assure employees the deal would go ahead and that reports of an investigation were just "rumors".

A Sun source has told The Reg the head of Sun's cloud computing group, senior vice president Dave Douglas, flew from his east-coast base to Sun's Menlo-Park, California, campus to personally re-assure staff.

"[He] told us that the rumors about the EU commission deadline were just that, and that Oracle had a team in Brussels that was negotiating with the commission," the source told us.

"He led us to believe that no announcement would be made the following day, and that the EU commission and Oracle would make an announcement when an agreement was reached."

The meeting was for Douglas' cloud computing group, but also saw other employees attend and dial in via phone. The cloud computing group is one of three business units created during a massive re-organization last year that led to the birth of the application platform software group under executive vice president Anil Gadre and the systems platforms group under executive vice president John Fowler.

Failure to hit a summer closure is not just embarrassing for the two companies, it's also hurting Oracle in an area it values - the wallet. Chief executive Larry Ellison has claimed the delay caused by the investigation is costing him $100m a month.

It's unclear how far Sun or its senior managers are actually engaged in pressing the case in Brussles on behalf of Oracle and Sun employees. The majority of lobbying - along with the footwork on the acquisition and integration of the two companies - now appears to be in the hands of Oracle staffers.

Sun's out-going captain Jonathan Schwartz was last Wednesday morning spotted well outside the corporate and lobbing loop, in conversation on his cell and sporting a baseball cap outside a coffee shop near his Noe Valley home in a leafy neighborhood of San Francisco, California.

Amid all the uncertainty, at least one thing does appear to have been settled. The Reg has learned that there will be no more JavaOne conferences under the new Oracle owner. Brokers close to the deal have been telling people Sun's annual JavaOne is finished, and it's believed the event will instead be rolled into Oracle's OpenWorld conference each fall.

Oracle declined to comment for this story. ®

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