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By Dawn Kawamoto, 22 December 2005 15:45

NEWS

European Commission officials gave their blessing on Thursday to Oracle's $5.8bn merger with Siebel Systems, removing the last major antitrust hurdle for the enterprise software companies.

The EC declined to challenge Oracle's mega-merger with Siebel Systems, a move that had been anticipated by industry watchers.

The commission said in a statement: "After examining the operation carefully, the Commission concluded that the transaction would not significantly impede effective competition... and has therefore approved the concentration."

The EC noted that the only area the two enterprise software vendors face overlap is in customer relationship management (CRM) software, a fragmented market, according to the EC's statement.

The EC stated: "The Commission also examined possible conglomerate effects. Widely used open standards make it unlikely that the merged entity would impose restrictions on newly acquired Siebel's CRM customers, as regards to their use of non-Oracle databases."

The green light from European antitrust regulators stands in stark contrast to their response to Oracle's acquisition of another archrival, PeopleSoft. Both the EC and the US Department of Justice raised concerns about the takeover when it was proposed. After 18 months of hostile manoeuvring to acquire PeopleSoft, however, Oracle ultimately prevailed.

With its last antitrust hurdle cleared in the Siebel deal, Oracle now awaits approval from the Securities and Exchange Commission. Oracle executives previously indicated they expected the merger to close in the first quarter, as early as mid-January.

Despite generating less controversy than the PeopleSoft deal, Oracle's pending acquisition of Siebel has not been without drama.

Oracle executives at one point were in buyout discussions with Siebel while also trying to land the PeopleSoft deal.

And the Department of Justice, which lost its court challenge in the PeopleSoft case, expressed a desire to take a more in-depth look at the Siebel merger, before ultimately allowing it to proceed.

Dawn Kawamoto writes for CNET News.com