The Redwood Shores, California-based Oracle lifted its offer to 24 dollars per share from a previous bid of 21 dollars.

"This price represents a significant premium to recent trading prices, and is in excess of the 52-week closing-price high for PeopleSoft shares," Oracle said in a statement.

"The increased offer price is nearly 60 percent higher than the closing price on the day prior to Oracle's announcement of its intention to commence the original offer."

Oracle said clearance for its bid from European Union antitrust authorities last week had prompted the move, in the belief it would persuade PeopleSoft to drop its remaining obstacles to the deal.

The offer, perhaps the most bitter takeover battle in Silicon Valley history, will expire November 19, Oracle said.

"Our best and final offer is 24 dollars per share, which we believe represents a substantial premium to the price at which those shares would trade were it not for Oracle's offer," said Jeffrey Henley, Oracle's chairman. "We will withdraw our offer unless a majority of PeopleSoft shares are tendered into our offer by November 19, 2004."

While PeopleSoft had staged a spirited takeover defense, the company showed signs of cracking. On October 1, PeopleSoft dumped the chief executive leading its takeover defense, Craig Conway, and US regulators dropped their antitrust case against a merger of the two firms.

Oracle chief executive Larry Ellison wants to acquire PeopleSoft in order to compete with Germany's SAP, the market share leader for high-end business software. The companies are awaiting a Delaware court-ruling, which seeks to remove PeopleSoft's takeover defenses.

Following the revised offer, PeopleSoft shares rocketed higher by 2.16 dollars or 10.4 percent to 22.93. Oracle gained nine cents to 12.75.

CIBC World Markets analyst Brad Reback said that the deal is still "far from over, as wrangling over the (PeopleSoft defensive) poison pill in court will likely push the consummation of this deal into the new year, if at all. We would take this opportunity to take profits in PeopleSoft."

Philip Carnelly, a software analyst at technology market research firm Ovum in London, said he thinks PeopleSoft will have to capitulate to Oracle in light of the latest offer.

"There must be huge, huge pressure on the PeopleSoft board now," Carnelly said. "It's incumbent on them to remove the poison pill now, otherwise it looks like the offer will be withdrawn ... The shareholders will be pretty upset if they're not given the option to take 24 dollars and the share price drops to 16 dollars."

Bruce Richardson and Jim Shepherd at AMR Research said they think the battle could drag on.

"It was only a few weeks ago that Oracle management was talking the price down, and now it has raised the offer ... Our bet, though, is that PeopleSoft's board continues its pattern of describing the offer as 'inadequate' and 'undervaluing' the company," they said in a research note.

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