Peoplesoft’s board announced that it is formally rejecting Oracle’s latest hostile bid to buy the company, saying “the revised offer price is inadequate and does not reflect PeopleSoft's real value.”

The board made its decision based on advice from leading analyst firms Citigroup Global Markets Inc. and Goldman, Sachs & Co., as well as the fact that the merger faces strict antitrust scrutiny. “There is a significant likelihood that the transaction will be prohibited under antitrust law,” the board said in a statement addressing the rejected offer.

Peoplesoft also said it felt its current share price was undervalued due to Oracle’s continued hostile bid for the company.

“The board believes that PeopleSoft has a better plan for stockholders,” said Craig Conway, PeopleSoft’s president and CEO. “Oracle's offer does not begin to reflect the company's real value, including the value we are creating through our successful combination with J.D. Edwards. We believe Oracle is using the entire process – tender offer, antitrust and proxy solicitation – in an attempt to damage our company. Don't underestimate the significant additional value PeopleSoft can create once the disruption from Oracle's hostile activities has ended."

Oracle last week made its revised offer, upping its previous bid of $19.50 per share to $26 per share, for a total of $9.4 billion. This is the second time Oracle has increased its bid, which it originally made in June at a price of $16 per share.

Although Peoplesoft’s board voted to reject the latest offer, that isn’t the end of it. Oracle is hoping Peoplesoft’s shareholders will vote out the current board and install a new merger-friendly group of directors at their next meeting March 25.

For more information, visit Peoplesoft here.