UPDATE 1-Russia approves Oracle, Sun merger with conditions

Fri Mar 19, 2010 11:59am EDT

* Demands Oracle continues to develop MySQL

* Order has a term of four years

(Adds details of regulatory decision, background)

MOSCOW, March 19 (Reuters) - Russia's anti-monopoly regulator (FAS) said on Friday it had approved a $7 billion takeover of Sun Microsystems JAVA.O by Oracle ORCL.O on condition that Oracle continues to develop Sun's MySQL database.

FAS said it would have grounds to go to court and demand invalidation of the deal, already approved unconditionally by the European Union, if Oracle does not comply with its requirements. "FAS has reviewed the application and ... has decided to approve the application," FAS said in a statement, adding the approval would only be valid if Oracle meets requirements regarding the MySQL business.

The regulator said Oracle must continue to create new versions of MySQL within the generally accessible licence and should not oblige clients to buy its services if they want to get a commercial licence for MySQL.

It added the condition would only apply for four years after the deal is formerly completed.

In January, Oracle won European Union approval for the takeover after promising to keep the market open for others to make storage engine software for Sun's MySQL database and to boost investment in the unit. [ID:nLDE60K10P]

It also pledged to set up a separate customer advisory board of MySQL users. Those concessions satisfied Europe's competition watchdog that the deal will not distort the market.

But Michael Widenius, the creator of the MySQL database, who is strongly opposed to the merger plan, said the European Union executive's decision was wrong and turned his vocal campaign against the deal to Russia and China. [ID:nLDE60G0HL] (Reporting by Maria Kiselyova and Tarmo Virki; Editing by David Holmes)