Oracle Corp., the world's second- largest software maker, may step up stock buybacks if the share price drops too much, Chief Executive Officer Larry Ellison said.

``We will look at accelerating our own buyback if our stock gets too cheap,'' Ellison said today at a meeting of analysts in San Francisco.

Ellison, 64, was responding to a question that referred to Microsoft Corp.'s plans to repurchase as much as $40 billion in shares, raise its dividend and borrow money in the form of commercial paper. Microsoft began offering a dividend in 2003.

``I quite frankly think Microsoft should have done a buyback a while ago instead of a dividend,'' Ellison said. ``We will take on more debt if we think it makes sense. We have pretty fantastic cash flow right now. We can borrow more.''

Oracle shares have lost 9.3 percent this year. The stock rose 52 cents, or 2.6 percent, to $20.47 at 4 p.m. New York time in Nasdaq Stock Market trading.

Oracle, which reported about $13 billion in cash and marketable securities last week, has relied on debt to help fund a $34.5 billion acquisition spree starting in January 2005. The company raised $5 billion in April after selling bonds to finance its purchase of BEA Systems Inc. Ellison has said the worsening economy could prompt Oracle to take over more companies.

``As companies go on sale and become more attractively priced, we will look at buying them,'' he said.

The company, which ranks second to Microsoft in software sales, approved a $4 billion stock buyback in April 2007.

Source:Bloomberg