"The money in our company is real, not leveraged. When we have money we buy, and we haven't, we don't buy," said Oracle Israel managing director and Oracle Corp. (Nasdaq: ORCL) VP Moshe Horev yesterday. He was speaking at a press conference to mark the opening of the annual Oracle Week. Horev's emphasis on real money comes against the backdrop of the extensive leverage in other markets which culminated in the recent collapse of the financial industry. Oracle, claimed Horev, has spent around $30 billion on acquisitions in recent years, "all of which were made without leverage and with real money."
The most recent acquisition in Oracle's shopping spree was that of project portfolio management (PPM) solutions developer Primavera Software Inc. a month ago. Primavera has an R&D center in Jerusalem, which it acquired with the acquisition of ProSight Ltd. in 2006 for $45 million. The acquisition has expanded Oracle's R&D center in Israel, which is based on the acquisition in 2006 of Demantra, taking the number of people employed by Oracle Israel to 280. "People ask me if we're going to fire people," said Horev. "But we have no intention of firing anyone for the time being. We learned how to streamline six years ago in the previous crisis, and our cost structure is excellent. We sleep well at night."
As for Oracle's plans, Horev said, "It's business as usual Oracle. We're expanding and have further acquisitions in the offing. The opportunities around now are a lot better in terms of price, and Oracle is constantly looking at Israeli companies too."
Two months ago, Oracle announced a collaboration with Hewlett Packard Co. (NYSE:HPQ) on the provision of a turnkey enterprise computing system complete with hardware. Horev said he believed the current crisis would accelerate the trend towards commoditization in enterprise IT resources and as a consequence, the transition to software intensive devices at the expense of the more expensive and less elastic hardware, will work in Oracle's favor.
Published by Globes [online], Israel business news - www.globes-online.com - on November 24, 2008
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