Oracle Corp. agreed to buy Aconex Ltd., an Australian company that manufactures cloud-based collaboration software for construction projects, for $ 1.56 billion ($ 1.19 billion) in penetrating deeper in new markets.
The transaction values Aconex at AUD7.80 per share, 47% more than Friday's closing price. Aconex jumped 44% to AUD 7.63 at 11:09 in Sydney on Monday.
Oracle has sought to reshape its business around Internet-based products. The strategy experienced a decline in the last quarter when cloud computing sales missed analysts' estimates. The Redwood City, California-based company also gave disappointing forecasts for cloud growth in last week's earnings report, which dropped the biggest shares in three months. Oracle has turned to acquisitions to accelerate its move to the cloud, including the acquisition of NetSuite Inc. last year ($ 9 billion)
The Aconex board unanimously recommended the deal, said the Melbourne-based company in a statement. The directors of the company, which represent approximately 13.6% of the capital, will vote in favor of the offer in the absence of a superior proposal.
The Australian business software is used by infrastructure and construction managers to track the status and potential costs of their projects. It is also one of the few Australian technology companies to have a global footprint. According to data compiled by Bloomberg, only eight technology companies listed in Australia are worth more than $ 1 billion Australian compared to 21 mining companies.
Aconex has become Australia 's most shortened stock after its stock price has fallen dramatically earlier this year. The race was triggered by a downward revision of revenue forecasts, attributed to the market uncertainty caused by the vote on Brexit and the election of Donald Trump to the US presidency.
Luke Macnab, an analyst at Baillieu Holst Ltd., said Oracle and Aconex companies are expected to be in a strong position thanks to the strong niche offering of the Australian company and Oracle's global footprint. . The expansion of Aconex in Europe has done worse than originally expected, and the deal would likely give it access to Oracle's sales and R & D resources.
"Aconex was looking to grow globally over the next five to ten years," Macnab said. "This allows them to get a global scale pretty much instantly."
RBC Capital Markets analyst Paul Mason said Oracle would likely not face competing offers from domestic players because no local competitor could match its size or its size. income.
"Oracle seems reasonably unlikely to face significant competition now that he has made his first move," he said. "They would need quite large private equity funds, or something like that, to be able to make a competitive bid."
Aconex is listed on the Australian Securities Exchange in December 2014 and sells shares for $ 1.90 each. According to its website, it has more than 70,000 customers and its cloud-based software has been used on 16,000 projects in the construction, infrastructure and energy sectors in 70 countries.