Oracle and Cerner have jointly announced an agreement for Oracle to acquire Cerner through an all-cash tender offer for $95 per share, or approximately $28.3 billion in equity value. The transaction is expected to close in calendar year 2022.
Cerner is a provider of digital information systems used within hospitals to enable medical professionals to deliver better healthcare to individual patients and communities. It has more than 4 decades of experience modernizing electronic health records, improving the caregiver experience, and streamlining and automating clinical and administrative workflows.
“Working together, Cerner and Oracle have the capacity to transform healthcare delivery by providing medical professionals with better information—enabling them to make better treatment decisions resulting in better patient outcomes,” said Larry Ellison, chairman and chief technology officer, Oracle. “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 that enable access to information via a hands-free voice interface to secure cloud applications. This new generation of medical information systems promises to lower the administrative workload burdening our medical professionals, improve patient privacy and outcomes, and lower overall healthcare costs.”
“We expect this acquisition to be immediately accretive to Oracle’s earnings on a non-GAAP basis in the first full fiscal year after closing—and contribute substantially more to earnings in the second fiscal year and thereafter,” added Safra Catz, chief executive officer, Oracle. “Healthcare is the largest and most important vertical market in the world—$3.8 trillion last year in the United States alone. Oracle’s revenue growth rate has already been increasing this year—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. That’s exactly the growth strategy we adopted when we bought NetSuite—except the Cerner revenue opportunity is even larger.”
“Cerner has been a leader in helping digitize medical care and now it’s time to realize 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 officer, Cerner. “Joining Oracle as a dedicated Industry Business Unit provides an unprecedented opportunity to accelerate our work modernizing electronic health records (EHR), improving the caregiver experience, and enabling more connected, high-quality and efficient patient care. We are also very excited that Oracle is committed to maintaining and growing our community presence, including in the Kansas City area.”
The closing of the transaction in 2022 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.
The companies said that Cerner systems running on the Oracle Gen2 Cloud will be available 24x7x365, with the goal of delivering zero unplanned downtime in the medical environment.
Cerner will be organized as a dedicated Industry Business Unit within Oracle.
Oracle also said that Cerner will be its anchor asset to expand into healthcare and together they will improve medical care for individuals and communities around the world. Oracle intends to maintain and grow Cerner’s community presence, including in the Kansas City area, while utilizing Oracle’s global footprint to reach new geographies faster.