In one of the biggest acquisitions to hit the payments space in recent years, enterprise technology giant Oracle announced Monday it would pay $US5.3 billion in cash for Micros Systems, a leading provider of payment terminal software and hardware in the restaurant and hospitality space.
Oracle, which is known for its acquisition-based growth strategy, gets a healthy business out of the acquisition, with Micros posting roughly 20% operating margins.
But experts believe there’s more to the deal.
“By acquiring Micros, Oracle is gaining an instant customer base and domain expertise in the hospitality and retail industries,” Morningstar analyst Rick Summer writes in an investor note obtained by BI Intelligence.
“Oracle may be better able to sell database and analytics products to Micros’ customer base, totaling more than 330,000 installation sites,” Summer adds.
Jason Oxman, CEO of industry group the Electronic Transactions Association, agrees that for Oracle, the deal is all about Micros’ merchant relationships. “This acquisition shows the importance of direct relationships with merchants through their point of sale systems,” Oxman told BI Intelligence in an email.
“The ‘cash register’ was once just a cash drawer and UPC scanner,” Mr. Oxman writes. But, “today payments companies are integrating software solutions, including inventory, loyalty, and payments, into point of sale.”
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