Pink slips on the way for Siebel employees?

The Oracle and Siebel deal is closed and some analysts say employees from both companies could find themselves displaced.

With the megamerger between Oracle and Siebel Systems closed, Wall Street analysts are forecasting pink slips for Siebel employees.

But Siebel, a large vendor of customer relationship management (CRM) software, may not be the only one to feel the pain . Analysts have noted that Oracle employees involved with its own CRM efforts may find themselves displaced.

Oracle on Thursday plans to discuss its integration path and business outlook for the combined companies, during a conference call with analysts.

Siebel, which recently closed its $5.85 billion merger with Oracle , may find 60 percent of its 4,686 employees cut, UBS analyst Heather Bellini predicted in a research note. That forecast is based on an assumption that the Siebel merger will add 2 to 3 cents to Oracle's earnings within the next 12 months, she noted.

Other analysts--including WR Hambrecht's Robert Stimson and Sanford Berstein's Charles Di Bona--also anticipate layoffs.

"Oracle said it wanted to cut costs by a couple hundred million when it announced the deal," Di Bona said. "I would imagine it will come from a mix of the two companies, but more heavily weighted toward Oracle."

Oracle has previously indicated it plans to use Siebel's technology as its core CRM product and, as a result, Oracle's CRM sales and marketing team may feel the deepest cuts, Di Bona noted.

Administrative Siebel employees, such as those in finance and human resources, will likely encounter the heaviest cuts, he added.

Stimson, meanwhile, predicted in his research note that he anticipates Oracle to "immediately execute a round of lay-offs" in Siebel's administrative and back office areas.

"We estimate that Oracle will have to cut Siebel's operating costs by approximately...$350 million to $400 million in order to meet its previously stated accretion goals," Stimson said in his research note.

During the first nine months of Siebel's fiscal year, general and administrative expenses reached $76 million and sales and marketing reached $270.9 million. The company's product development area generated operating expenses of $211.9 million in the nine months ended Sept. 30, according to Siebel's quarterly filing with the Securities and Exchange Commission.

Stimson not only anticipated layoffs in the Siebel camp, but also among employees of the former PeopleSoft and J.D. Edwards companies, two enterprise applications vendors that Oracle acquired last year.

"We have been hearing that further headcount reductions among PeopleSoft and J.D. Edwards employees may occur shortly as the company begins to implement its longer-term vision for Fusion," Stimson said in his report.

Fusion is Oracle's next-generation enterprise applications suite , which is intended to meld the technologies of its previous acquisitions into an integrated package with newly developed technologies.

Oracle declined to comment.

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