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.
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.