With IPO, Ellison Walks $500M Tightrope

NetSuite offering reveals Oracle chief's major stake in rival
Posted Jul 3, 2007 5:30 AM CDT
With IPO, Ellison Walks $500M Tightrope
Exterior view of Oracle headquarters in Redwood City, Calif. Tuesday, June 26, 2007. Oracle Corp.'s fiscal fourth-quarter profit topped analyst expectations, providing further validation for a $25 billion shopping spree that has enabled the software maker to narrow rival SAP AG's long-standing lead...   (Associated Press)

It's murky waters ahead for Oracle CEO Larry Ellison, a day after rival NetSuite Inc. revealed in an IPO filing that the outspoken billionaire holds a 74% stake. That puts Ellison, whose Oracle holdings are valued at $24 billion, in a tricky spot: Other shareholders may view the joint investments as a serious conflict of interest, the Wall Street Journal reports.

Ellison, who helped to launch NetSuite, has since moved to distance himself from the on-demand software provider, ending his stint as chairman in 2003 and later leaving the board, according to Reuters. Still, his position in both companies is "pretty touchy," says one corporate governance expert. "It's fraught with danger." 

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