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Diagnosis confirmed: Oracle has a case of healthcare cravings, bought Cerner for $28.3bn as the cure

Deal will see Cerner's systems shifted to the Big Red Cloud and medicos given hands-free voice interface

Rumours that Oracle planned to buy healthcare software concern Cerner have proven correct.

A joint statement from the two companies today announced the deal and valued it at $28.3B through an all-cash tender offer for $95.00 per share, immediately accreditive to Oracle’s earnings as a non-GAAP earning.

Oracle’s executive veep Mike Sicilia said his company plans to modernize Cerner’s systems and move them to the Gen2 Cloud, which he reckons can be done quickly as some of Cerner’s most prized systems already run on the Oracle Database.

“No change required there. What will change is the user interface,” said Sicilia. The veep said Orcacle’s hands-free Voice Digital Assistant would become the primary interface of Cerner’s clinical systems.

“This will allow medical professionals to spend less time typing on computer keyboards and more time caring for patients,” he added.

Oracle has a play in lots of vertical industries, including health insurance and analytics, but until now, not healthcare itself. The database giant said it plans to use Cerner as an anchor asset to expand further into the market.

“Healthcare is the largest and most important vertical market in the world—$3.8 trillion last year in the United States alone,” said Oracle CEO Safra Catz. Catz also said Oracle’s growth strategy with Cerner would mirror the one deployed to grow cloudy ERP product NetSuite into new geographies.

“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,” said Catz.

All major enterprise tech players covet a bigger stake in the healthcare industry, because it is colossal and rich. Plenty have expressed a belief they can disrupt the industry, especially in the USA, and make it simpler to navigate and more efficient.

Google’s parent Alphabet, for example, has a known penchant for hiring chief health officers in the hopes of revolutionizing the healthcare industry, or at least cashing in on it.

As The Reg pointed out last week, the deal will be meaningful when it comes to Oracle's business in the UK. Cerner has been awarded more than £100m in deals with England's National Health Service (NHS) just in the past year alone. Cerner was also a key player in the country's National Programme for IT, which went down as one of the greatest IT disasters in public sector history. By buying Cerner, Oracle will be acquiring a specific health records system, an advantage it has so far lacked when making deals with the NHS.

Oracle now owns a proven product in the field, plus a plan to improve it with some cloudy AI fairy dust on it. Might Big Red have stolen a march? ®

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