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Oracle's Bid Hasn't Brought Merger Mania

"What we are finding is that rather than the large companies thinking through growth prospects and revenue enhancements in a deal, we're seeing a lot of analysis go into cost savings," said Karl Will, head of tech M&A at J.P. Morgan Chase in San Francisco. That's a different approach for tech than in the past, said Will, whose firm advised Computer Associates on its $430 million Netegrity acquisition announced last week.

Still, "in this environment, like most, M&A deals are rare," Will added. "There's little in the way of catalysts forcing people to do transactions -- forcing in a good way."

But companies are pursuing acquisitions for the right reasons and not the wrong ones, Will said, citing the "me, too" attitude a few years ago when deals begat deals. "I'd characterize it as a very healthy M&A environment," he concluded.

This could very well mean that rather than embark on an acquisition binge, software companies are more likely to control their appetites.

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