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Mellanox Shares Surge After Oracle Buys Stake

The share prices of Mellanox Technologies climbed after software maker Oracle acquired a 10.2 per cent in the company.

According to Business Week, the share price of Mellanox rose by $1.28, or 6 per cent, to $22.53 during the afternoon trading session.

Oracle CEO Larry Ellison had announced that the company was planning to acquire semiconductor companies also adding that it would not make "unsolicited and unfriendly" acquisition bids.

The main reason behind the acquisition is that Mellanox makes products for InfiniBand, which is an industry standard and championed by Oracle. The acquisition could also benefit a new line of products that Oracle is planning to dish out.

Mellanox Technologies makes technology that helps in increasing the speed of data flow in server and storage systems.

Oracle said in a statement: “This allows Oracle to leverage Mellanox's InfiniBand products to create differentiated Oracle solutions like Exadata and Exalogic. A strong and friendly relationship with Mellanox is critical to Oracle.”