March 10, 2008
Oracle Acquisitions- A Teacher to Learn From
Analysis of:
Oracle sheds light on its acquisition strategy | news.zdnet.co.uk
This analysis is solely the work of the author. It has not been edited or endorsed by GLG.
Implications: No doubt that in the current globalization era, the way to grow business and market share passes through mergers and acquisitions. Oracle has perfectly taught the IT world how to do it. Digesting 40 companies in less than 15 months is an achievement by its own, but making a positive synergy that is a master art.
Analysis: Increasing market share and cutting TTM ( Time To Market) is a key in any large comapny that wants to dominate its market sector. The common way, used in the globalization era , is by mergers and acquisitions. Many acquisitions occured during the last decade. Few succeeded and have brought added value to the shareholders or serve the original goals of the acquisition. Cisco in the communication sector and Teva in pharmacautics are two examples of companies who know what to do along the process. They set the goals, they know what they are looking for, they select the candidates and more than that - they extract the benefits from these acquisitions. However, Oracle sets its position as the master teacher of those moves.
Several rules are applied to judge what is a successful acquisition but the most important and straightforward is the value ( profit, market share, revenues) this move is bringing to the acquiring company. Oracle proves now that it knows how to digest an acquired company. It was not so all the time but it knew how to learn the lessons from those acquisitions that turned to be less successful. PeopleSoft acquisition is probably a milestone on its career way and probably used a signalling post when considering its recent acquisitions.
At the end of the day, a successful acquisition is a "win-win" situation to the end customer but more to the acquiring company, and Oracle proves it in its dominant position in the enterprise software world.
Analysis: Increasing market share and cutting TTM ( Time To Market) is a key in any large comapny that wants to dominate its market sector. The common way, used in the globalization era , is by mergers and acquisitions. Many acquisitions occured during the last decade. Few succeeded and have brought added value to the shareholders or serve the original goals of the acquisition. Cisco in the communication sector and Teva in pharmacautics are two examples of companies who know what to do along the process. They set the goals, they know what they are looking for, they select the candidates and more than that - they extract the benefits from these acquisitions. However, Oracle sets its position as the master teacher of those moves.
Several rules are applied to judge what is a successful acquisition but the most important and straightforward is the value ( profit, market share, revenues) this move is bringing to the acquiring company. Oracle proves now that it knows how to digest an acquired company. It was not so all the time but it knew how to learn the lessons from those acquisitions that turned to be less successful. PeopleSoft acquisition is probably a milestone on its career way and probably used a signalling post when considering its recent acquisitions.
At the end of the day, a successful acquisition is a "win-win" situation to the end customer but more to the acquiring company, and Oracle proves it in its dominant position in the enterprise software world.
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