Oracle Acquires Taleo for $1.9 Billion
Another day, another deal in the cloud software space. Today, software giant Oracle stepped up to acquire Taleo, the cloud-based human resources software concern, for $46 a share, or $1.9 billion. The price works out to an 18 percent premium on Taleo, based on its closing price on Wednesday.
The deal can’t help but be seen as a response to SAP’s acquisition last year of SuccessFactors, a Taleo rival. Indeed, Taleo’s shares have appreciated significantly in recent months — from $29 to $42 a share over the course of two weeks in December — on speculation that it would be the next cloud company to fall to the recent burst of acquisitions in the cloud software space. And so it has.
If Taleo is a new name to you, perhaps you should go back and read this interview I did with its CEO Mike Gregoire (pictured), about a week after the SuccessFactors deal. The company had been on track to do $325 million in revenue, and has been growing at a 20 percent annual clip.
What’s strange is that Gregoire seemed uninterested in being acquired by Oracle at the time, mainly because he had lived through Oracle’s hostile takeover of PeopleSoft, and had been with that company “until the bitter end.” Apparently, Gregoire and his board have seen past any reticence about Oracle this time around.
The press release is below:
Oracle Buys Taleo
Adds Leading Talent Management Cloud Offering to the Oracle Public Cloud
DUBLIN, CA–(Marketwire -02/09/12)- Oracle today announced that it has entered into an agreement to acquire Taleo Corporation (NASDAQ: TLEO – News), a leading provider of cloud-based talent management for $46.00 per share or approximately $1.9 billion, net of Taleo’s cash and debt. Taleo’s Talent Management Cloud helps organizations attract, develop, motivate and retain human capital to improve performance and drive growth.
Together, Oracle and Taleo expect to create a comprehensive cloud offering for organizations to manage their Human Resource operations and employee careers. The combination is expected to empower employees and managers to effectively manage careers throughout their entire employment, enable organizations to retain talent and optimize costs, and improve the employee experience through faster on boarding and better collaboration with team members via social media.
The Board of Directors of Taleo has unanimously approved the transaction. The transaction is expected to close mid-year 2012, subject to Taleo stockholder approval, certain regulatory approvals and other customary closing conditions.
“Human capital management has become a strategic initiative for organizations,” said Thomas Kurian, Executive Vice President, Oracle Development. “Taleo’s industry leading talent management cloud is an important addition to the Oracle Public Cloud.”
“Taleo’s integrated cloud-based talent management solutions optimize how organizations hire, manage, develop and reward their employees and gives companies the intelligence needed to capitalize on their most critical asset — their people,” said Michael Gregoire, Chairman and CEO, Taleo. “Joining forces with Oracle gives us the opportunity to better serve our customers.”