Wednesday October 21, 06:40 PM
UPDATE 1-EU says Oracle fails to allay concerns on Sun deal
By Foo Yun Chee and Bate Felix
BRUSSELS, Oct 21 (Reuters) - Oracle Corp has not eased the European Union's concerns that its plan to buy Sun Microsystems Inc could be anti-competitive, the EU's antitrust chief told the tech group's president on Wednesday.
The European Commission, which polices competition in the 27-country EU, is expected to decide by Jan. 19 whether to approve the planned $7 billion takeover of Sun by the world's second largest software maker.
EU Competition Commissioner Neelie Kroes set out her views in a meeting with Oracle President Safra Catz in Brussels, said Kroes' spokesman, Jonathan Todd.
'Commissioner Kroes expressed her disappointment that Oracle (NASDAQ: ORCL - news) had failed to produce, despite repeated requests, either hard evidence that there were no competition problems or, alternatively, proposals for a remedy to the competition problems identified by the (European) Commission,' Todd said.
Heads of big companies have come to Brussels before to meet Commission officials but such meetings usually indicate the situation is serious.
The EU executive can issue a so-called statement of objections to companies in an in-depth investigation, such as that relating to Oracle's Sun bid, which involves the Commission setting out its concerns in writing.
The Commission said last month it was concerned about direct competition between Oracle's databases and Sun's open source database MySQL and it wanted to ensure alternatives remained available to users.
Oracle Chief Executive Larry Ellison has said he will not spin off MySQL despite Sun losing about $100 million a month because of the regulatory uncertainty. He has said he expects unconditional European regulatory clearance.
MySQL, which competes mainly against Microsoft Corp (NASDAQ: MSFT - news) 's SQL Server, is used to run websites operated by companies including Google Inc (NASDAQ: GOOG - news) , Facebook and Amazon.com Inc. Its main customers are small and medium-sized companies.
Analysts said Sun, the fourth biggest maker of computer servers, was losing customers as rivals Hewlett-Packard Co and IBM (NYSE: IBM - news) offered incentives to woo users.
Kroes told Catz the regulator was willing to move quickly to reach a final decision but it was up to Oracle to find a solution, Todd said.
Sun said on Tuesday it was cutting 3,000 jobs worldwide, blaming delays in its sale.
(Editing by David Holmes) Keywords: ORACLE SUN/EU
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