Oracle has bought online customer service company RightNow Technologies, a producer of cloud CRM and customer support applications, for $1.5 billion.
Oracle offered to pay $43 a share for RightNow, which is about 20 percent more than the company’s closing price on Oct 21st. The deal is expected to close later this year or early 2012.
Oracle is interested in RightNow mainly because of its multi-channel customer support capabilities that work across call centers, social networks and the world-wide-web.
The acquisition, Oracle’s largest since its $7.4 billion takeover of Sun Microsystems in 2010, is part of a larger push by the company to build out its cloud-based software services called the Oracle Public Cloud, which delivers software on the internet via cloud computing. The cloud is becoming increasingly important to Oracle.
“RightNow's leading customer service cloud is a very important addition to Oracle's Public Cloud. The acquisition will allow Oracle to have superior customer experience at every contact and across every channel” Redwood City, California-based Oracle said in the statement.
Oracle's purchase of RightNow will also make it a "more direct competitor and formidable threat to SalesForce.com's service cloud offering", said analyst Brad Reback from Oppenheimer.
Monday, Oracle shares surged by 75 cents, or by 2.3%, to $32.87 as of 4.pm trading on the Nasdaq where as RightNow shares gained by $6.98, or by 19%, to $42.94.
Earlier this year, Oracle’s CEO, Lawrence J. Ellison, announced that he was restraining his finances and looking into organic growth by focusing on smaller deals and building on its existing products. Even though the company has made a number of acquisitions this year, it has focused on smaller, privately held firms.
