Oracle buys Textura for $663 million, eyes engineering, construction cloud services
Oracle said it will buy Textura, which provides contract and payment cloud services for the construction industry, in a deal valued at $663 million.
The price equates to about $26 a share.
For Oracle, Textura will bolster its engineering and construction cloud platform. If you zoom out, Oracle's move highlights how the industry cloud--service providers focused on a vertical--is developing into big business.
Textura processes about $3.4 billion in payments for more than 6,000 projects a month. Textura's cloud serves as a aggregation point for contractors, developers and subcontractors. There are about 85,000 general and subcontractors in the Textura network. Textura also offers collaboration tools and covers most aspects of a development project.
Here's a look at Textura's touch points in a construction payment cycle.
The plan for Oracle is to combine Textura with it Primavera business to form one engineering and construction operating unit. The deal is expected to close in 2016.
Stifel analyst Brad Reback noted that Oracle's acquisition of Textura may mean more deals are coming. Reback said:
While its too early to suggest the M&A spigot will be turned wide open, and while we have no knowledge of any M&A activity or discussions, deals like this always raise the question of who is next, and we have long suggested a number of SaaS players such as Castlight, Demandware, ChannelAdvisor, Paycom, Paylocity and Splunk, among others, would make for nice tuck-in acquisitions.
In a presentation, Oracle outlined the reasoning behind the purchase as well as how its engineering and construction cloud will go together.
Separately, Oracle launched a series of updates to its Field Service Cloud, which is powered by TOA Technologies, a previous acquisition.