By Dhirendra Tripathi
Investing.com – Cerner stock (NASDAQ:CERN) rose 1.1%, to $90.86, after the company said Oracle (NYSE:ORCL) would buy it for $95 a share, or around $28.3 billion.
Trading in Cerner shares was halted earlier in the day pending the news. Oracle shares fell 3%.
Expected to close some time in 2022, Oracle CEO Safra Catz said the all-cash deal will add immediately to Oracle’s earnings on adjusted basis and contribute substantially more second financial year onward. Cerner will be organized as a dedicated industry business unit within Oracle, the former said in a press release.
The Wall Street Journal first reported the deal last week.
Healthcare – a $3.8-trillion industry last year in the U.S. alone according to Oracle -- already has a key presence in the enterprise software company’s revenue stream. Cerner offers technology to help insurers, care providers and public health systems parse data for better patient outcomes.
The acquisition is expected to help Oracle’s pivot to the cloud, a move the company was initially relatively slow to embrace. Its strategy has become more aggressive in the last year as rivals Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL) have surged ahead.
Cerner said the goal is to deliver zero unplanned downtime in the medical environment.
In a post-Covid world, healthcare has become a go-to industry for tech companies to tap new areas of growth. Microsoft has struck a $16-billion deal to buy Nuance Communications (NASDAQ:NUAN), a provider of clinical speech recognition software, medical transcription and medical imaging. That deal awaits regulatory approval.