Oracle Puts Chip Makers, Software Vendors on Shopping List

Talking with analysts as Oracle OpenWorld wrapped up, CEO Larry Ellison said he may buy a semiconductor vendor, industry-specific software makers and possibly NetApp.

Oracle CEO Larry Ellison is still in an acquisitive mood, and he now could be setting his sights on buying a semiconductor company.

At a meeting with analysts Sept. 23, as Oracle's OpenWorld show wound down in San Francisco, Ellison reportedly said his company would be interested in buying a processor company, igniting speculation around such firms as ARM, Advanced Micro Devices, Nvidia, Marvell and Broadcom.

"Our focus is to build our [intellectual property] portfolio," Ellison said during the meeting with analysts, according to Reuters. "You could see us buying chip companies. Silicon is very important, software IP is very important."

With its $7.4 billion acquisition of Sun Microsystems earlier this year, Oracle joined the race to offer integrated data center solutions, competing against the likes of IBM, Hewlett-Packard, Dell and Cisco Systems. Ellison, who has been vocal in his desire to take on tech giant IBM, sees the combination of Oracle's database and enterprise software and Sun hardware as a key differentiator for his company going forward.

Oracle, the world's third largest software vendor, gave the industry a look at where it's going during the OpenWorld show, rolling out its Exalogic offering, an integrated hardware and software solution designed to let businesses run a private cloud environment from a single, self-contained system. The Exalogic hardware held both the Oracle and Sun logos.

It follows on Oracle's Exadata integrated database system, rolled out last year. A new version of Exadata was introduced at OpenWorld.

Oracle also gained chip development capabilities through the Sun deal. Sun created the SPARC processor platform and also built servers that were powered by AMD and Intel chips.

In talking about buying a semiconductor company, Ellison reportedly said he wanted to model his approach to that of Apple CEO Steve Jobs, whose company bought chip makers as it built its popular iPhone and iPad devices.

Oracle may be looking at a processor vendor that makes chips for servers, said Doug Freedman, an analyst at Gleacher and Co., citing AMD, Nvidia and IBM's chip business, according to Bloomberg.

"You've got to think it's focused on enterprise hardware, on the server," Freedman said. "AMD jumps off the screen."

Further fueling speculation over Ellison's hardware ambitions was the decision earlier this month to hire former HP CEO Mark Hurd. Hurd's hiring came a month after he resigned under pressure from HP following a sexual harassment complaint from a former HP contractor and the discovery that he fudged expense reports to conceal his personal relationship with her.

Ellison, a close friend of Hurd's, soon after blasted the HP board of directors for forcing out Hurd, and then hired Hurd as co-president of Oracle.

During the analyst meeting, Ellison also reportedly turned his attention to other areas, including software makers whose products are focused on particular industries, a move that would help Oracle differentiate from rival SAP.

In addition, he also threw storage maker NetApp's name into the discussion. Ellison pointed out that about 60 percent of NetApp's business revolves around data from Oracle databases.

"We love that business," he said, according to The Register. "We would love to have that 60 percent. Do we need to acquire? I think there are some interesting technologies we'd like to acquire. ... I think it is possible."