Oracle chops 5000 heads

Oracle has laid plans to cut 5000 employees from the combined Oracle-PeopleSoft organisation.

Oracle, the California-based database vendor, completed its buyout of PeopleSoft just last week, and was expected to cut anywhere from 2000 to 6000 employees, eliminating redundancies.

The totals announced were at the high end of that range, and Oracle said the combined company will field a workforce of 50,000.

Most employees will be notified over the next 10 days, the company said in a statement released after the market close Friday [US].

"By retaining the vast majority of PeopleSoft technical staff, Oracle will have the resources to deliver on the development and support commitments we have made to PeopleSoft customers over the last 18 months," said Oracle chief executive Larry Ellison, in the statement.

Oracle executives plan to outline more details of its so-called PeopleSoft Integration Plan this week.

Oracle claimed PeopleSoft officially as its own on 7 January, after an often-vituperative hostile takeover attempt was launched in June 2003.

The huge layoffs were expected. Both companies were based in the San Francisco area, with PeopleSoft across the bay in Pleasanton.

Oracle said it intends to keep 90 percent of PeopleSoft's product development and product support staff. And, Ellison, who drove this deal, has said the company will "oversupport" both the PeopleSoft products as well as the PeopleSoft 8.9, now under development, and the subsequent PeopleSoft 9.0 release.

He and other Oracle executives were forced by adverse publicity to pledge public support for those products after an initial statement seemed to indicate Oracle would dead-end those products and force migrations to its own, less mature e-business applications.

One analyst at the time of the initial offer characterised it more as a "hostage taking" than an acquisition offer.

PeopleSoft's resistance paid off, Oracle's initial US$5.1 billion cash bid grew to US$10.3 billion.