Oracle Corporation has entered into an agreement to acquire North Kansas City, Missouri-based health information technology company, Cerner Corporation, in an all-cash tender offer for $95 per share.
Under the $28.3 billion transaction, Oracle will implement its Autonomous Database, Voice Digital Assistant user interface and low-code development tools to modernize Cerner’s electronic medical records systems and move them to Oracle’s cloud environment, the companies said Monday.
Safra Catz, CEO of Oracle, said the deal builds on Oracle’s increasing revenue growth rate and will help the company expand its footprint in the healthcare vertical market, which Catz noted was valued at $3.8 trillion last year in the United States.
“We expect this acquisition to be immediately accretive to Oracle’s earnings on a non-GAAP basis in the first full fiscal year after closing—and contribute substantially more to earnings in the second fiscal year and thereafter,” Catz explained.
She added that Cerner will be a “huge additional revenue growth engine” as the company broadens its growth trajectory internationally.
Additionally, Larry Ellison, chairman and chief technology officer for Oracle, commented, “With this acquisition, Oracle’s corporate mission expands to assume the responsibility to provide our overworked medical professionals with a new generation of easier-to-use digital tools that enable access to information via a hands-free voice interface to secure cloud applications.”
He said, “This new generation of medical information systems promises to lower the administrative workload burdening our medical professionals, improve patient privacy and outcomes, and lower overall healthcare costs.”
The purchase, which marks Oracle’s largest to date, is expected to close in 2022 upon receiving regulatory and stockholder approvals and satisfying other closing conditions.