Wall Street just loves the rumor mill. And in the rumor mill of mergers, the grander the better. One big technology acquisition may beget other big technology acquisitions. So what happens when you have rumors of Salesforce.com (NYSE: CRM) having buyout interest? Now what are you supposed to think if Oracle Corp. (NYSE: ORCL) had also raised $10 billion this week?

Before investors get too aggressive on rumors about the likelihood of Salesforce.com being acquired, they better take at least a minute to consider the caveats or risks associated with this versus the possibilities.

First off, the other likely acquirer that would be competing in a bid would have to include Microsoft Corp. (NYSE: MSFT), Satya Nadella has been marching toward cloud computing and mobile. Well, with the CRM offerings a company like Salesforce.com would make sense. The question is of course at what price.

Salesforce.com has always been considered a potential takeover target, with Oracle as the most likely suitor. After all, Marc Benioff used to be with Oracle — and he has a rivalry with Larry Ellison. Ellison had been, or is, a holder of Salesforce.com shares after backing the company. And despite a serious rivalry, Salesforce.com and Oracle also have a strategic partnership with each other.

The problem that has always gotten in the way is that Salesforce.com’s stock has a market value that was already about $42 billion or so before the rumors broke — then it was $47.5 billion or so after the rumors. On top of that, Salesforce.com has had nosebleed market valuations forever. It just never trades at under 100-times expected earnings, or if so not for very long. It is also expensive against revenues, with a 7.2 multiple on that front for expected current year revenues that is.

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So, what about that $10 billion capital raise by Oracle? A 424B2 filing with the Securities and Exchange Commission hit the tape on Wednesday. It turns out that this $10 billion deal has the following tranches:

• $2,500,000,000 2.500% Notes due 2022
• $2,500,000,000 2.950% Notes due 2025
• $500,000,000 3.250% Notes due 2030
• $1,250,000,000 3.900% Notes due 2035
• $2,000,000,000 4.125% Notes due 2045
• $1,250,000,000 4.375% Notes due 2055

As far as the buyout rumors themselves, Bloomberg first reported that Salesforce.com was hiring bankers to field takeover inquiries, then that Salesforce is working with financial advisors after a takeover approach. And investors can take comfort about the source being “unnamed people with knowledge of the matter.” Just for the record, those unnamed people are constant sources of rumors — and many of those rumors never come to fruition, even though some do.

The use of proceeds section of the offering said:

Oracle intends to use the net proceeds of the offering for general corporate purposes, which may include stock repurchases, payment of cash dividends on its common stock and future acquisitions. The company’s filings showed that Oracle already had $43.77 billion in cash and $98.8 billion in total assets. At the same time, it had approximately $50.3 billion of total liabilities.

Oracle’s filing also said: “we had the ability to borrow up to an additional $3.0 billion under our commercial paper program and $3.0 billion under our revolving credit facility.”

As far as Microsoft being a potential acquirer, Benioff was just at the Microsoft Build developers conference on Wednesday.

Is it possible that Microsoft is going into a bidding war against Oracle to buy Salesforce.com?

Salesforce.com closed up 11.6% at $74.65, against a 52-week range of $49.18 to $78.46, and against a consensus analyst price target of $75.57.

Oracle closed up 0.5% at $44.73, in a 52-week range of $35.82 to $46.71, and it has a consensus price target of $46.28.

Microsoft closed down by 0.2% at $49.06. Its 52-week range is $38.51 to $50.05, and the consensus price target is $47.61.

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As a reminder, anything is possible when it comes to the rumor mill and technology giants. Sometimes it is still hard to believe what comes out of that rumor mill.

The only official press release from Salesforce.com on Wednesday indicated that the company’s first-quarter fiscal 2016 results will be released on Wednesday, May 20, 2015, after the close of the market.

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