Oracle Agrees to Acquire SelectMinds - Analyst Blog

By Zacks | September 19, 2012 AAA

Oracle Corp (ORCL) has agreed to buy SelectMinds, a cloud-based recruiting solutions provider. The acquisition is expected to be completed in the second half of 2012. However, the financial details were not disclosed. Oracle has integrated SelectMinds products into Oracle Cloud Recruiting, Performance Management and Human Capital Management applications. SelectMinds provides recruitment solutions to various organizations by leveraging its software solution (TalentVine) that enables employers to execute social recruiting campaigns by using a single interface. The SaaS solutions offered by SelectMinds provide better recruitment results by targeting social networks such as Facebook Inc. (FB), LinkedIn Corp. (LNKD) and Twitter connections. The company has a distinguished clientele, which comprise companies like International Business Machines Corp (IBM), eBay Inc. (EBAY) and JPMorgan Chase & Co. (JPM) to name a few.

Along the same lines, Oracle had bought Taleo Corp., a SaaS human resource software provider, for $1.9 billion in the early part of 2012. Taleo's Talent Management Cloud helps organizations to enhance human resource capabilities, improve performance and drive growth.

Oracle remains very active on the acquisition front and generally targets companies that can be integrated within its existing or new product lines. Oracle also acquires organizations with competing technologies with the intention of eliminating rival products. We believe that acquisitions in the field of human resource management and cloud computing will be beneficial for Oracle over the long term.

However, Oracle faces significant integration risks due to the rapid pace of acquisitions within a short span of time, in our view. We also note that Oracle is a late entrant in the field of cloud computing compared to peers such as salesforce.com Inc. (CRM) and Microsoft Corp. (MSFT). Hence, it might face tough competition.

We remain Neutral on a long-term basis (6-12 months). Currently, Oracle has a Zacks #3 Rank, which implies a Hold rating on a short-term basis.

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