Oracle Brass Has Knack Lately for Friday Farewells

Oracle(ORCL) is developing a nasty little habit of losing its top executives on late Friday afternoons.

The company said Friday that Gary Bloom, heir apparent to the No. 1 spot at the database and applications software maker, would leave the company to become CEO of fellow Silicon Valley shop Veritas(VRTS).

The move comes five months after Oracle announced at the end of June, also late on a Friday, that president Ray Lane would leave the company. He has since resurfaced in the Valley's other venerable profession -- venture capitalism.

Bloom, a 14-year company veteran, headed up Oracle's core database business and was widely viewed as the person who would succeed founder Larry Ellison as CEO. But with Ellison showing a renewed commitment to his company lately, analysts say Bloom probably knew Ellison would keep him waiting.

"I always thought Gary would be the next CEO," said Brent Thill, an analyst at Credit Suisse First Boston. "Apparently, Gary understood that Larry was going to be around for a while. It's Larry's baby, and he's going to leave when he wants to leave. On the other hand, Gary really wanted to own the CEO title." (Credit Suisse rates Oracle a strong buy, and the firm hasn't done underwriting for the company.)

In a press release, Ellison said, "Gary is joining a key Oracle partner. With Gary at Veritas, we expect an already close relationship to grow even closer. He is a first-rate executive, and Gary is ready to be CEO."

Like many software companies in Silicon Valley, Oracle and Veritas often work together to make their respective products compatible.

The company said several senior executives will take over Bloom's responsibilities.

The market, though, didn't seem to be ready for Bloom's surprise departure. Shares of Oracle sold off sharply on Island ECN. After closing up $1.44, or 5%, at $28.81 at the end of the regular session, the shares fell to $24.94 in after-hours trading.

After Lane's unexpected departure this summer, speculation started swirling about management depth at the company. Lane was seen as the balancing presence to Ellison's flamboyant -- some would say arrogant -- personality, and Lane later said that Ellison had slowly taken away much of his responsibility.

More recently, rumors started swirling that Jeff Henley, Oracle's even-keeled CFO, would leave the company, along with a rumor that Ellison had died. The rumors gained so much momentum in the market that the CEO actually had to deny his own death.

Given this backdrop, another Oracle exec leaving the company hardly seems like positive news. "Obviously, at first blush, it doesn't look great," Thill said. "This is going to crush the stock."

He added, though, that the company has said Henley isn't going anywhere, and Ellison is fully engaged. "Ellison knew about this for weeks," Thill said. "Gary really wanted to be a CEO, and Veritas is very complimentary to what Oracle is doing."

But next time the company might want think about letting investors in on the story before they leave for the weekend.

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