Oracle Clarifies Acquisition Strategy

For the first time in recent memory, Oracle CEO Larry Ellison and Oracle Co-President Charles Phillips (pictured, left to right) seem to be having a public difference of opinion. Last week, Phillips publicly stated Oracle would planned to pump $70 billion into acquisitions over the next five years. But Oracle’s corporate PR team says no such M&A budget exists.

For Phillips’ original comments, take a look at this Fortune.com video clip. The upshot: “If you look forward for the next five years, we’ll probably double what we’ve spent on acquisitions in the last five years,” Phillips said in that clip.

The clearly astonished host asked for clarification, at which point Phillips reaffirmed his prediction that Oracle would be spending $70 billion — twice the $35 billion he referred to in his original statement — in the next five years. And the clip also shows that he believes the Sun Microsystems acquisition wasn’t enough for Oracle and that they’d be on the lookout for more hardware companies.

That brings us to now, where an Oracle spokesperson stated:

“Oracle does not have a five year acquisition budget. We don’t even have a one year acquisition budget. While it is highly unlikely that we will spend anything approaching $70 billion in five years, we will be opportunistic and, if market conditions warrant, we will buy additional companies that further our strategic goals and address our customers’ needs.”

Hmmm… Does Oracle have an M&A war chest? Did Phillips speak out of turn? I think that after the sheer scale of the Oracle/Sun deal, Oracle will likely spend the next few months focusing on business execution rather than mega acquisitions.

We’ll be tracking more Oracle-related news closely during this week’s Avnet Technology Solutions Partner Summit near Denver, Colo.

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