Oracle plans to buy NetSuite, which provides a cloud suite of software for managing business operations and customer relations, for $9.3 billion. The deal brings together two companies that already had close financial and personal ties.
Oracle Chairman Larry Ellison was an early investor in NetSuite, and owned 39.7% of outstanding shares immediately prior to the acquisition. NetSuite CEO Zach Nelson previously worked for Ellison as head of marketing, and Chairman/CTO Evan Goldberg, along with other top management, previously worked at Oracle.
"Oracle and NetSuite cloud applications are complementary, and will coexist in the marketplace forever," Oracle CEO Mark Hurd said in a statement. (See Oracle Acquires NetSuite for $9.3B in Cloud Push.)
Oracle is paying $109 per share in cash, 19% above the closing price Wednesday. Oracle expects the deal to close this year.
Since NetSuite's founding in 1998, Oracle has gone from cloud skeptic to aggressive cloud adopter. Like rival Microsoft Corp. (Nasdaq: MSFT), Oracle is focused on the hybrid cloud, bringing together Oracle's traditional on-premises applications with cloud software. Oracle offers a full stack, including hardware based on its 2009 acquisition of Sun Microsystems.
NetSuite was originally known as NetLedger, and distinguished itself from competition by offering an integrated suite of enterprise resource planning (ERP) products, rather than a merger of separate software components.
Oakland A's General Manager Billy "Moneyball" Beane has been a member of the NetSuite board of directors since 2007.
It's been a busy week for enterprise cloud acquisitions. Riverbed Technology Inc. (Nasdaq: RVBD) is buying Aternity to help enterprises improve performance of cloud applications. (See Riverbed Buying Aternity for Endpoint Management.)