To expand its construction management portfolio, Oracle has made its second acquisition of cloud-based construction software so far. The software giant agreed to purchase Australian firm Aconex Limited for AUD$7.80 per share, adding up to a whopping USD$1.2 billion. With a price tag that high, the publically traded Aconex (ASX: ACX) appears to be a significant investment for the Oracle Construction and Engineering Cloud portfolio.
Aconex designs software for project collaboration that is capable of connecting owners, builders and other teams to access and manage project data and costs throughout a construction project. In 2014, Aconex released its Aconex Connected BIM product, which added building information management (BIM) to the Aconex platform.
Aconex is one of only eight technology companies on the ASX worth over $1 billion, and its software has been used in projects valued at more than $1 trillion across 70,000 organizations in 70 countries. These customers include Bechtel, Marriott, Dubai Airport and AECOM, among others.
The acquisition of Conject in 2016, gave the company access to the European market, customers like international construction firm Mace, and a construction project cost management tool from Conject.
After releasing disappointing financial results and forecasts for its cloud computing products, Oracle’s shares have been tumbling. The company has been refocusing its business on Internet-based products, using acquisitions, such as the $9 billion purchase of NetSuite Inc., to bolster its cloud computing line.
Aconex is Oracle’s second AEC purchase, following its acquisition of Textura, a contract and payment management platform, for $663 million in 2016. Joining Textura with Oracle’s own construction management software, Primavera, allowed the software giant to form its Oracle Construction and Engineering Global Business Unit.
Mike Sicilia, senior vice president and general manager of the Construction and Engineering Global Business Unit at Oracle, said of the purchase, “Delivering projects on time and on budget are the highest strategic imperatives for any construction and engineering organization. With the addition of Aconex, we significantly advance our vision of offering the most comprehensive cloud-based project management solution for this $14 trillion industry.”
Aconex is intended to work with Oracle’s existing cloud-based construction software, which enables project planning, management and payments. The acquisition is set to close in the first half of 2018.
While the deal may help Oracle bounce back on the stock market, it may also lead to some added competition in the AEC software industry, which is currently dominated by just a handful of companies like Autodesk, SCIA, Bentley Systems and Trimble.
To learn more about Oracle’s Construction and Engineering Global Business Unit, visit the website.