Oracle is nearing a deal to acquire healthcare information technology group Cerner for about $30bn, according to people briefed about the matter, as Larry Ellison’s company seeks to cement its position in one of the fastest-growing corners of the IT industry.
The move to acquire Cerner, best known for creating electronic medical records, follows Microsoft’s $16bn agreement to buy speech artificial intelligence company Nuance Communications, as the biggest software companies seek to forge deeper connections in the healthcare industry.
Cerner’s business is heavily reliant on sales and support of traditional software, along with services. But it has been trying to move deeper into newer cloud services — a market where Oracle is also trying to grow.
The healthcare IT company recently collaborated with the Vaccination Credential Initiative, to launch a global digital passport to facilitate international travel following the Covid-19 outbreak in late 2019.
The potential deal, which was first reported by The Wall Street Journal, would be the largest for Oracle. A year ago, it reached a preliminary agreement to acquire TikTok, the Chinese-owned social media company, as part of a transaction aimed at addressing national security concerns raised by then-president Donald Trump.
Oracle’s unusual plan to buy TikTok was later shelved by Joe Biden’s administration, leaving the company led by Safra Catz to focus on acquiring groups more in line with its core business.
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The last big deal carried out by Oracle was the $9.3bn acquisition of cloud computing group NetSuite in 2016, which was aimed at positioning the Texas-based company to better compete with the likes of Microsoft and Salesforce.
Ellison, who was a large investor in NetSuite, pocketed about $3.5bn from the transaction.
Oracle led an earlier phase of consolidation in the software industry, buying companies such as PeopleSoft and BEA Systems as well as server company Sun Microsystems. Ellison gained a reputation for being unwilling to pay high premiums for companies he bought during Oracle’s earlier spate of acquisitions, and the group has largely stayed away from dealmaking as software valuations have boomed in recent years.