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Oracle said to near $5B purchase of Micros Systems
Employees at Micros, which is based in Columbia, work on computer systems in a testing lab. (File photo)

Oracle said to near $5B purchase of Micros Systems

Oracle Corp. is nearing a $5 billion deal to buy Columbia-based Micros Systems Inc., which provides hardware and software for hotels, restaurants and retailers, people familiar with the matter said.

Oracle and Micros are in exclusive talks, though the two sides could still fail to reach an agreement, said the people, who asked not to be identified discussing a private matter.

Micros has more than 6,500 employees, including about 900 in Maryland, according to its most recent annual report. The company serves more than 370,000 restaurants, 30,000 hotels and 59,000 retail stores across the globe.

Oracle Chief Executive Larry Ellison is looking to acquisitions to fuel expansion after 10 quarters of sluggish sales growth. Oracle was late to the market for Internet-based cloud software and is now rushing to remake itself as a provider of gear and programs to underpin its clients’ shift to Web-based computing.

Micros’ shares rose 15 percent to $66.33 at the close in New York and earlier soared as much as 22 percent, their biggest gain since September 1996. Oracle rose less than 1 percent to $42.32.

Oracle, based in Redwood City, California, came close to acquiring Micros about six years ago, according to one person with knowledge of the matter. Micros Chairman Tom Giannopoulos, who was CEO at the time, flew from Maryland to California to sign a deal, only to have the transaction fall through at the last minute, this person said.

Micros brought in $349 million in revenue during the quarter ending March 31. In fiscal year 2013, which for Micros ended in June 2013, it made $1.27 billion, a 14.5 percent increase over the previous year.

Micros has made some acquisitions of its own over the years. In 2012, it dropped 114.5 million pounds on Torex Retail Holdings Ltd., a British company that provides information technology to the retail sector. In 2010, it acquired Washington-based Tig Global, which specialized in online hotel and destination marketing.

Technology dealmaking is accelerating as established software companies try to navigate the shift to cloud computing and fend off challenges from new competitors. Earlier this week SanDisk Corp. agreed to buy Fusion-io Inc., which provides storage to Facebook Inc. and Apple Inc., for about $1.1 billion.

Deborah Hellinger, a spokeswoman for Oracle, declined to comment. Peter Rogers, executive vice president of investor relations at Micros, didn’t immediately return calls seeking comment.

Oracle will report its quarterly earnings on Thursday. In the previous quarter, license and cloud-subscription revenue fell short of analysts’ estimates.

The company has spent $50 billion to acquire about 100 companies in the past decade. Of those, more than 20 have been geared at specific industries, including the 2010 acquisition of clinical-trial software maker Phase Forward Inc., and purchases of retailer-software makers ProfitLogic Inc. and Retek Inc. in 2005.

“This would really be an acquisition for their retail arm and it would add another leg to their growth stool as they are more focused on their e-commerce and cloud strategy,” said Daniel Ives, an analyst at FBR Capital Markets & Co., who rates Oracle the equivalent of a buy. “They haven’t really made a big acquisition in the last few years and they need more fuel in the tank.”

The acquisition of Micros would be Oracle’s largest since the $5.7 billion takeover of Sun Microsystems Inc., announced in 2009, data compiled by Bloomberg show.

Staff writer Lizzy McLellan contributed to this story.

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