Oracle is acquiring NetSuite, a cloud-based provider of accounting and financial management services, in a deal valued at about $9.3 billion.
Oracle’s $109-a-share offer is at a 19% premium to Netsuite’s Wednesday close.
“Oracle and NetSuite cloud applications are complementary and will coexist in the marketplace forever,” Oracle co-CEO Mark Hurd said in a statement. “We intend to invest heavily in both products – engineering and distribution.”
Oracle cofounder, executive chairman, and chief technology officer Larry Ellison holds a roughly 45% share in NetSuite together with his family, according to Bloomberg.
Ellison was an early investor in the company, which launched in 1998 and was one of the first “cloud” applications.
In an interview on stage at the AllThingsD conference in 2012, Ellison claimed that NetSuite was his idea, making him – not Salesforce CEO and former Oracle employee Marc Benioff – the creator of cloud computing: “I started NetSuite. NetSuite was my idea. I called up Evan Goldberg and said, ‘We’re going to do ERP on the Internet, software-as-a-service.’ Six months later Marc Benioff, finding out what NetSuite was doing, and kind of copied it,” he said. That may be an exaggeration, but Ellison has always held a big stake in the company, and NetSuite CEO Zach Nelson (who took over in 2002) was previously a VP at Oracle
The deal is expected to close later this year, pending shareholder and regulatory approval.
(Reporting by Anya George Tharakan in Bengaluru; Editing by Anil D’Silva and Business Insider)