Oracle agrees to acquire Cerner for $28bn

August 2022 | DEALFRONT | MERGERS & ACQUISITIONS

Financier Worldwide Magazine

August 2022 Issue

In a deal designed to transform healthcare delivery, US multinational technology company Oracle Corporation is to acquire electronic health records firm Cerner Corporation in a transaction valued at $28.3bn.

Under the terms of the agreement, the acquisition is through an all-cash tender offer for $95 per share, with the transaction expected to close later in 2022.

A leader in the healthcare IT industry and a complementary business to Oracle, Cerner provides digital information systems used within hospitals to enable medical professionals to deliver better healthcare to individual patients and communities. The company has over four decades of experience modernising electronic health records, improving the caregiver experience, and streamlining and automating clinical and administrative workflows.

Working together, Cerner and Oracle will provide medical professionals with better information that enables them to make better treatment decisions resulting in better patient outcomes. Moreover, a new generation of medical information systems promises to lower the administrative workload burdening medical professionals – improving patient privacy and outcomes and lowering overall healthcare costs.

Cerner will be organised as a dedicated industry business unit within Oracle and will be Oracle’s anchor asset to expand into healthcare and improve medical care for individuals and communities around the world. At the same time, Oracle intends to maintain and grow Cerner’s community presence, including in the Kansas City area, while utilising Oracle’s global footprint to reach new geographies faster.

“With this acquisition, Oracle’s corporate mission expands to assume the responsibility to provide our overworked medical professionals with a new generation of easier-to-use digital tools,” said Larry Ellison, chairman and chief technology officer at Oracle. “This will enable access to information via a hands-free voice interface to secure cloud applications.”

Industries covered by Oracle include, among others, financial services, telecommunications, utilities, pharmaceuticals, hospitality, retail, food & beverage, construction & engineering, manufacturing and government.

“Cerner has been a leader in helping digitalise medical care and now it is time to realise the real promise of that work with the care delivery tools that get information to the right caregivers at the right time,” said David Feinberg, president and chief executive of Cerner. “Joining Oracle as a dedicated industry business unit provides an unprecedented opportunity to accelerate our work modernising electronic health records (EHR), improving the caregiver experience and enabling more connected, high-quality and efficient patient care.”

In addition, with Oracle’s resources, infrastructure and cloud capabilities, Cerner will be able to accelerate the pace of product and technology development to enable more connected, high-quality and efficient care.

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.

“Healthcare is the largest and most important vertical market in the world,” concluded Safra Catz, chief executive of Oracle. “Our revenue growth rate has already been increasing this year and 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.”

Fraser Tennant