Oracle announced that the company has signed an agreement for the company to acquire Cerner, through an all-cash tender offer for $95.00 per share, or approximately $28.3 billion in equity value. Cerner is a digital information systems provider used within hospitals and the healthcare industry.
$95.00 per share
Oracle stated that with the acquisition, the duo aims to provide medical professionals with better information, allowing them to make better decisions resulting in better outcomes. Oracle will provide a new generation of easier-to-use digital tools focused on simplifying access to information via a hands-free voice interface. With the new solutions, the duo will lower the administrative workload.
- All-cash tender offer for $95.00 per share, or approximately $28.3 billion, that is immediately accretive to Oracle’s earnings.
- Accretive to Oracle’s earnings on a non-GAAP basis in the first full fiscal year after closing and will contribute substantially more to earnings in the second fiscal year and thereafter.
- Cerner will be a huge additional revenue growth engine for Oracle for years to come as Oracle expands Cerner’s business into many more countries throughout the world.
- Transaction is expected to close in the calendar year 2022. The closing of the transaction is subject to receiving certain regulatory approvals and satisfying other closing conditions including Cerner stockholders tendering a majority of Cerner’s outstanding shares in the tender offer.
- Oracle anticipates retaining an investment-grade credit rating.
- Oracle brings significant experience helping power the largest industries.
- Oracle provides industry solutions that run the core operations for customers in the world’s largest industries.
- Industries covered by Oracle today include, among others, Financial Services, Telecom, Utilities, Pharmaceuticals, Hospitality, Retail, Food & Beverage, Construction & Engineering, Manufacturing and Government.
- Oracle also brings best-in-class cloud infrastructure to drive digital modernization, substantially lowering the total cost of IT in these critical industry sectors.
- Cerner is a leader in the healthcare IT industry and a complementary business to Oracle.
- Cerner is a leading provider of digital information systems used within hospitals to enable medical professionals to deliver better healthcare to individual patients and communities.
- Cerner has over four decades of experience modernizing electronic health records, improving the caregiver experience, and streamlining and automating clinical and administrative workflows.
- Together, Oracle and Cerner will protect customer investments and transform healthcare.
- According to a recent study by the Mayo Clinic1, physicians spend 1 to 2 hours on EHRs and desk work for every hour spent in face-to-face contact with patients, as well as an additional 1 to 2 hours of personal time on EHR-related activities.
- Working together, Cerner and Oracle have the capacity to address these issues and transform healthcare delivery by providing medical professionals with better information, enabling them to make better treatment decisions resulting in better patient outcomes.
- Customer investments in Cerner are also protected with this combination and will grow in value over time as more modern and connected technologies are made available.
- With Oracle’s resources, infrastructure, and cloud capabilities, Cerner will accelerate the pace of product and technology development to enable more connected, high-quality, and efficient care.
- Oracle’s focus on usability and voice-enabled user interfaces will dramatically reduce the amount of time that medical providers spend dealing with systems and increase the time they spend directly caring for patients.
- Significant opportunity to help customers use Oracle’s modern technologies such as cloud, AI, ML, and other innovations to make care more accessible, secure, efficient, and effective for patients and caregivers.
-
- Cerner systems running on the Oracle Gen2 Cloud will be available 24 by 7 by 365. Goal is to deliver zero unplanned downtime in the medical environment.
- With Cerner systems running on the Oracle database, only specifically authorized medical professionals can access patient data. IT professionals running the systems are unable to look at patient data.
- Oracle and Cerner are committed to continued and enhanced stewardship of health information, which will be bolstered by Oracle’s global operational infrastructure.
-
- Cerner will be organized as a dedicated Industry Business Unit within Oracle.
- Cerner will be Oracle’s anchor asset to expand into healthcare and together we will improve medical care for individuals and communities around the world.
- Oracle intends to maintain and grow Cerner’s community presence, including in the Kansas City area, while utilizing Oracle’s global footprint to reach new geographies faster.
Safra Catz, Chief Executive Officer of Oracle said,
« 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. Healthcare is the largest and most important vertical market in the world, $3.8 trillion last year in the United States alone. Oracle’s revenue growth rate has already been increasing this year, Cerner will be a huge additional revenue growth engine for years to come as we expand its business into many more countries throughout the world. That’s exactly the growth strategy we adopted when we bought NetSuit, except the Cerner revenue opportunity is even larger. »