Oracle announced a deal today to acquire Hyperion Solutions, which makes software that allows corporations to analyze and track their performance, for about $3.3 billion.
The deal is the latest trophy in a long string of acquisitions by Oracle, the database software giant that has been struggling to grow from within. Under terms of the deal, Oracle will pay $52 a share in cash for each share of Hyperion, a 21 percent premium over Wednesday’s closing price of $42.84. The deal is expected to close in April.
“The acquisition of Hyperion makes Oracle the category leader in the high-growth enterprise performance management market,” Oracle’s chief executive, Lawrence J. Ellison, said in a statement.
Oracle has long been known as one of the most aggressive acquirers of technology companies. Hyperion, which has more than 12,000 customers worldwide, including 91 Fortune 100 companies, sells analytic applications that aggregate data from corporate accounting systems for financial reporting. Such software is crucial in helping CFOs keep in step with federal compliance regulations.
Hyperion also offers planning and budgeting applications, which financial executives use to run businesses every day. The acquisition, which Oracle expects to close in April, will also give the software giant more leverage against SAP, the German applications giant Oracle has been targeting as its chief foe since it began snapping up applications vendors with a vengeance four years ago.
Hyperion is one of the last pieces to complete Oracle’s strategy. Founded in 1981 as IMRS, Hyperion has grown into one of the biggest makers of business analysis software through its Hyperion System 9 suite. Hyperion itself has grown through a series of deals, notably a 1998 merger with Arbor Software that brought the popular Essbase database software program into its fold.
"With Hyperion, we will be adding a leading enterprise planning system, a high-growth, leading financial consolidation solution, a powerful OLAP engine... and a global sales organization with over 1,900 sales and consulting professionals dedicated to business intelligence." Ventana Research CEO Mark Smith said Hyperion thinks the key to the deal is its strength in finance applications. "Oracle did not have a good footing in the office of finance, and this is the bulk of rationale behind it, but obviously some additional BI depth does not hurt,"
BI software, which IDC and Gartner estimate is a multi-billion-dollar market, enables corporations to gain more insight into the way their employees and business processes are performing.
Oracle already sells a complete BI suite, Business Intelligence Suite Enterprise Edition 10g, but adding Hyperion will give the software giant new corporate performance management tools and a large customer base.
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