Sources: Oracle is in talks to acquire electronic medical records company Cerner, in a deal that could be worth ~$30B, which would make it Oracle's biggest yet
An agreement, which could potentially be worth $30 billion, would rank as biggest ever for software giant
Wall Street Journal
Context & Ripple Effects
Oracle had previously used acquisition to expand its software portfolio, including the $9.3B NetSuite purchase, so a Cerner transaction would represent a much larger move into a defined industry vertical.
The related coverage traces the report into a $28.3B all-cash agreement, regulatory clearance, and Cerner’s appearance in Oracle’s reported revenue—evidence that the proposed deal became an operating part of Oracle’s business rather than a one-off M&A discussion.
First-order effects
Oracle would put its largest proposed acquisition at the center of its cloud strategy, while Cerner’s ownership and product direction move into a transaction process controlled by Oracle.
Cerner’s customers and employees face the prospect of an electronic-records provider being run within a much larger enterprise software vendor rather than as a standalone company.
Second-order effects
A completed acquisition gives Oracle a healthcare-data business it can pair with its cloud services; later results showed Cerner contributing $1.4B in quarterly revenue after the deal closed.
Oracle’s move raises the strategic value of vertical software platforms with recurring operational data, pressuring enterprise-software buyers to weigh build-versus-buy choices in specialized markets.
Third-order effects
If cloud vendors continue buying industry-specific software providers, competition shifts from generic infrastructure features toward control of the applications and data relationships embedded in regulated workflows.
The deal points to a more concentrated enterprise stack in which a small number of platform vendors own both cloud services and the vertical systems customers use day to day.
The trend: Cloud-oriented enterprise vendors are using large acquisitions to add vertical applications and the data-rich customer relationships that sit above infrastructure.
📢 Cerner is not a good community partner and the only ones who will benefit from this deal are a handful of wealthy executives. 📢 https://twitter.com/...
Potentially devastating for Kansas City. Another option would be for Oracle to look at making KC the AI & Cloud Healthcare capital. Hopefully the latter. Interested to know what the Epic boardroom are saying .... https://twitter.com/...
Throughout its history, every time $ORCL's back is against the wall... it does a big acquisition! // Oracle in talks to buy Cerner Corp., a deal that could be worth around $30 billion and push the enterprise-software giant further into healthcare https://www.wsj.com/... via @WSJ
This has been the year of M&A. Big deals. Buy the top line. Hope for cost cuts to create sufficient synergies to pump up the bottom line. https://www.wsj.com/...
If so, Oracle M&A strategy playbook (PTI, Relsys, Phase Forward, goBalto) may extend to other essential companies as per patterns a decade ago in the mobile and telecom market (MetaSolv, Acme Packet, Tekelec). https://twitter.com/...
Deepening its #Healthcare roots would likely be a nice way to accelerate its growth. And @Oracle is already on a nice trajectory this year. The final price will be something to watch if this happens. $ORCL https://www.wsj.com/...
Cerner is Kansas City's largest employer and one its most impactful success stories ever. Hope there is not only stability but continued growth here at home if the deal happens. https://www.wsj.com/...
@CaraRLombardo ... Cerner as a target for one of the cloud providers has been talked about for a while. The 2 companies have been pretty tight partners too.