HomeWhat's OnOracle Closes $9.3 Billion Acquisition of NetSuite

Oracle Closes $9.3 Billion Acquisition of NetSuite

9ac2ef6aca larger 16 ORACLE CTO LarryEllison 3

Tech giant Oracle announced the completion of its deal to acquire cloud company NetSuite for $9.3 billion in cash today. Oracle said that enough NetSuite shares — 53 percent — had been tendered in favor of the vote as of midnight Friday.

The completion of the deal caps off a dizzying few weeks of mergers and acquisitions activity in the enterprise tech sector. For example, semiconductor-maker Broadcom announced last month that it had agreed to acquire Brocade Communications Systems, the enterprise networking solutions company, for $5.5 billion, plus an additional $400 million in assumed debt.

Changing Its Tune on Cloud Services

ADVERTISEMENT

Oracle first announced its plans to acquire NetSuite in July. NetSuite was originally founded in 1998 as NetLedger, a provider of Web-hosted accounting software, partly on the strength of $125 million in capital provided by Oracle founder and now-chairman and CTO Larry Ellison (pictured above).

The acquisition is Oracle’s biggest since its $10.3 billion purchase of PeopleSoft in 2005, but the company has been busy putting together smaller deals for other cloud services providers. Earlier this year, Oracle announced plans to acquire the construction-focused firm Textura for $663 million and the utilities-focused Opower for $532 million.

Oracle’s current strategy of going all-in on cloud services is something of an about-face for the company. In 2008, Ellison derided the trend toward cloud computing as nothing more than a “fashion-driven” fad. But as the company faced increasing competition for enterprise services from cloud-based competitors such as Salesforce, it has been forced to change its tune.

Investing in Engineering and Distribution

“Oracle and NetSuite cloud applications are complementary, and will coexist in the marketplace forever,” Oracle’s co-CEO Mark Hurd said when the deal was first announced. “We intend to invest heavily in both products — engineering and distribution.”

The merger helps Oracle beef up its cloud offerings while also helping it reach smaller clients, including midmarket enterprises it may not have been able to reach before. NetSuite, meanwhile, should be able to benefit from the increased scale it can now achieve as part of the Oracle family, allowing it to sell to more industries and more markets.

“Gaining access to Oracle’s tremendous resources and deep technology stack makes this combination a winner for NetSuite’s customers, employees and partners,” Oracle said when the deal was first announced. “We expect NetSuite to utilize Oracle’s global scale and reach to accelerate the availability of its cloud solutions in more industries and more countries.”

NetSuite provides cloud-based software for enterprise resource planning and other applications to more than 30,000 business customers and organizations around the world. Enterprise resource planning (ERP) is one of the key areas that Oracle intends to focus on for its cloud strategy, along with customer relationship management and human capital management services.

Oracle is also aiming to move its other major software area, databases, to the cloud. The company is also likely looking to leverage the smaller ERP clients it has acquired through NetSuite into database clients.

Let’s block ads! (Why?)

ADVERTISEMENT

ADVERTISEMENT
Just in:
U.S. Compliance Takes Center Stage at OKX Following Industry Jitters // First-Ever Fortune Innovation Forum Draws Top Global Leaders to Hong Kong, Promoting Agendas On Collective Cross-Sector Advancement // TUMI Hosts Global Launch Event in Singapore to Unveil Women’s Asra Collection and Announce Global Ambassador, Mun Ka Young // Sharjah Chamber Breaks Ground on Final Expansion with New HQ Pact // Simplified Business Moves for Al Reem Island Firms // Global Audience to Witness Thrill of Dubai World Cup // Sunshine’s Debut Features Leave Tech World Scratching Its Head // Melco Style Presents “SANRIO CHARACTERS STUDIO CITY CARNIVAL” – Explore a SANRIO World of Unlimited Love and Cuteness // UAE Golden Gambit to Counter Saudi Bid for Business Leadership // Aid is at the core of Israel, Palestine struggle to control post-war Gaza // Andertoons by Mark Anderson for Fri, 29 Mar 2024 // German Job Market Resilience Bodes Well for Economic Recovery // Following the Money Trail: US and UK Investigate $20 Billion in USDT Transfers Tied to Sanctioned Russian Exchange // French Leaders Gather for Interfaith Iftar Dinner // New Nylon Constant Torque Hinge From Southco Provides Position Control In A Compact Package // A Tightrope Saudi Walk Towards Net-Zero // Samsung Partners National Heritage Board to Bring a Slice of Singapore’s Cultural Heritage to Samsung The Frame TV // CABSAT 2024 Ushers in 30 Years of Media Innovation // Universal Language for Healthcare: General Authority Embraces Global Coding System // Octa seeks to clarify Forex swap and swap-free accounts //