Microsoft, Google, Amazon – beware! There is a new player in the cloud game in town, and this one is not messing around.
Oracle has today announced that it's buying its once partner, NetSuite, for a total of $9.3 billion (£7.1bn). It will pay $109 per share, in cash – a 19 per cent premium compared to the company's closing price on Wednesday, according to the Wall Street Journal.
Both companies have cloud-based business solutions, but it seems as NetSuite has been somewhat more successful offering on-demand subscription products.
Oracle said it will invest ‘heavily’ in both products, and that the deal will add to its earnings, immediately: “Oracle and NetSuite cloud applications are complementary, and will coexist in the marketplace forever,” said Mark Hurd, Chief Executive Officer, Oracle. “We intend to invest heavily in both products—engineering and distribution.”
“We expect this acquisition to be immediately accretive to Oracle’s earnings on a non-GAAP basis in the first full fiscal year after closing,” said Safra Catz, Chief Executive Officer, Oracle.
The transaction, expected to close this year, is still subject to regulatory and shareholder approval.
“NetSuite will benefit from Oracle’s global scale and reach to accelerate the availability of our cloud solutions in more industries and more countries,” said Zach Nelson, Chief Executive Officer, NetSuite. “We are excited to join Oracle and accelerate our pace of innovation.”
Oracle is an aggressive buyer, Wall Street Journal says, reminding us that it also bought Opower and Textura Corpo. In 2014, it also bought Micros Systems Inc, and earlier, PeopleSoft, BEA Systems, and Sun Microsystems.
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