Oracle has entered into an agreement to purchase Sun Microsystems for a whopping $7.4 Billion.
Oracle's aquisition of Sun Microsystems give them a huge strategic advantage as in brings two very important pieces of software in house. Not only will this allow Oracle ensure the long term succes of their two biggest applications, they can ensure that addition research and development are committed to Sun's applications that support them.
Oracle is best known for its database and the Sun Solaris OS is the leading platform for their database. This allows for Oracle to tweak and optimize their database for some of Solaris's high-end features.
More importantly is that the aquisition brings Sun's Java in-house and Oracle's Fusion Middleware is built upon Java. Java is also widely used elsewhere making this a key asset for Oracle to have in their own hands.
Those interested in reading the full press release can find it here.
"We expect this acquisition to be accretive to Oracle's earnings by at least 15 cents on a non-GAAP basis in the first full year after closing. We estimate that the acquired business will contribute over $1.5 billion to Oracle's non-GAAP operating profit in the first year, increasing to over $2 billion in the second year. This would make the Sun acquisition more profitable in per share contribution in the first year than we had planned for the acquisitions of BEA, PeopleSoft and Siebel combined," said Oracle President Safra Catz.
"The acquisition of Sun transforms the IT industry, combining best-in-class enterprise software and mission-critical computing systems," said Oracle CEO Larry Ellison. "Oracle will be the only company that can engineer an integrated system - applications to disk - where all the pieces fit and work together so customers do not have to do it themselves. Our customers benefit as their systems integration costs go down while system performance, reliability and security go up."
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