news Oracle has entered into an agreement to acquire US-based cloud solutions provider NetSuite at a cost of approximately US$9.3 billion (AU$12.34 billion) in cash.
According to Safra Catz, Oracle CEO, the firm expects the acquisition to be “immediately accretive to Oracle’s earnings on a non-GAAP basis in the first full fiscal year”.
The evaluation and negotiation of the transaction was led by a special committee of Oracle’s board of directors that consisted “solely of independent directors”, who “unanimously approved” the transaction on behalf of Oracle and the board, Oracle said in a statement.
“Oracle and NetSuite cloud applications are complementary, and will coexist in the marketplace forever,” said Mark Hurd, Oracle CEO. “We intend to invest heavily in both products – engineering and distribution.”
Zach Nelson, NetSuite CEO, said: “NetSuite will benefit from Oracle’s global scale and reach to accelerate the availability of our cloud solutions in more industries and more countries. We are excited to join Oracle and accelerate our pace of innovation.”
The transaction is valued at $109.00 per share, and is expected to be completed later in 2016.
The closure is, however, subject to regulatory approvals and satisfying closing conditions, including NetSuite stockholders tendering a majority of NetSuite’s outstanding shares in the tender offer.
Furthermore, the deal is subject to a condition that a majority of NetSuite’s outstanding shares not owned by executive officers or directors of NetSuite, or individuals affiliated with Oracle executive chairman and CTO Larry Ellison, his family members and any affiliated entities, be tendered in the tender offer.
Evan Goldberg, Founder, Chief Technology Officer and Chairman, NetSuite commented on the acquisition, saying: “NetSuite has been working for 18 years to develop a single system for running a business in the cloud. This combination is a winner for NetSuite’s customers, employees and partners.”
In the Australian market, NetSuite has seen steady market growth against competition from the likes of Microsoft and Salesforce, with companies such as Seeing Machines, Lonely Planet and Unita amongst those moving to its cloud solutions.