Software

Oracle to Acquire Software Firm in Sh125bn Deal

Oracle is set to acquire Aconex as the firm intensifies its expansion strategy.

Updated on

January 4, 2018

Oracle construction software. — This marks Oracle’s second acquisition of a construction software firm. PHOTO | FILE

Oracle Corporation is set to acquire Aconex Ltd., an Australian software company, in a deal valued at Sh125 billion ($1.2 billion) as the California-based computer technology giant intensifies its decade-long growth strategy of purchasing enterprise software companies.

Aconex’s cloud-based collaboration software allows teams working on a construction site to collaborate and share documents across all stages of a construction project.

The software is essential for developers of mega projects, as these projects involve numerous contractors, suppliers, intricate building codes, and cumbersome paper documents, all of which are time-consuming and costly to manage.

“Delivering projects on time and budget are the highest strategic imperatives for any construction and engineering organization,” Mike Sicilia, who heads up Oracle’s Construction and Engineering business unit, said in a statement on December 17.

“With the addition of Aconex, we advance our vision of offering the most comprehensive cloud-based project management solution for this $14 trillion industry.”

Based in Melbourne, Aconex says its software has been used in projects valued at over Sh104 trillion ($1 trillion) across 70,000 organisations in more than 70 countries.

In a letter to customers, Aconex’s co-founder and chief executive officer Leigh Jasper said Oracle’s investment in Aconex will deliver more functionality and “capabilities at a quicker pace, as well as provide better integration and alignment with Oracle’s other product offerings.”

The purchase, at a cash price of Sh620 ($5.97) per share, is expected to close by the end of April, subject to Aconex shareholder approvals as well as usual regulatory consents – after which Aconex will become part of Oracle’s construction and engineering unit.

This marks Oracle’s second acquisition of a cloud-based construction software firm following the 2016 purchase of contract and payment management platform Textura for Sh68.9 billion ($663 million).

The multinational combined Textura with its construction management software known as Primavera to form the Oracle Construction and Engineering Global Business Unit.