BEA has turned down Oracle's $6.7bn acquisition offer, claiming that it undervalues the company.

"It is apparent to our board ... that BEA is worth substantially more to Oracle, to others and, importantly, to our shareholders than the price indicated in your letter," BEA president William Klein wrote in a letter to Oracle co-president Charles Philips.

Oracle is offering a 25 per cent premium over BEA's closing stock price on 11 October. But Klein believes that the valuation does not properly reflect the company's value.

"We believe that the absence of current financial information in the public markets limits investor visibility into our performance," he said, adding that BEA would disclose additional information in the near future.

BEA's stock price rose nearly 40 per cent on Friday, indicating that investors expect Oracle to raise its offer.

BEA specialises in middleware applications. Its flagship product is the AquaLogic application server, and the firm has been making a push into service oriented architectures. Oracle has a set of competing middleware applications.

Klein warned that the acquisition talks would have to be brief to minimise uncertainty among customers, and that he could only supply limited competitive information.