KANSAS CITY, Mo. — Oracle has bought Cerner, a Kansas City-based health information technology company, for roughly $28 billion.
Oracle, the second-largest software company in the world, made the cash deal final on Monday.
Rumors of the sale were discussed last week, causing Oracle's stock shares to drop 6%.
The software company is based in Austin, Texas. There is no word yet on how the purchase will affect hometown employer Cerner.
Cerner employs more than 26,000 people, including thousands in the Kansas City area. The company reported $5.5 billion in revenue in 2020.
“As part of Oracle, Cerner expects to have a greater opportunity to grow and strengthen Kansas City as a true center of excellence for healthcare” Chairman of Cerner’s Board of Directors William Zollars said in a statement. “This combination aligns a leading tech company with a leading healthcare company, enabling us to answer a higher calling that Cerner’s founders envisioned from the start. The expected result will yield a patient impact that can truly transform healthcare worldwide.”
Kansas City, Missouri Mayor Quinton Lucas reacted to the announcement on Monday.
He called the deal twofold.
"One, look out for employees now. Look out for those 13,000 people and their families and two make sure we continue to be a place that we can grow strong businesses that build great global brands," Lucas said.
I will speak with leaders from Cerner today about the impact of the Oracle acquisition on the 13,000 Cerner associates in the Kansas City area. Kansas City will work hard to retain all jobs already here and to gain an even greater presence globally in healthcare technology.— Mayor Q (@QuintonLucasKC) December 20, 2021
KSHB 41 News heard from some employees who said they're not sure what to think about the deal at this point.
UMKC Associate Professor of Finance, Nathan Mauck shared his thoughts on the acquisition and what it could mean for employees.
"You don't really know what's going to happen exactly. It'll be changes for sure," Mauck said.
Typically, he said it's common after mergers to see layoffs of the company that's bought, but in this case, Oracle might be going a different route.
"So, they really view Cerner as a growth engine," Mauck said. "So, being a growth engine may be no or fewer cuts to than we might typically see in a deal."
Oracle said Cerner will be a dedicated Industry Business Unit within Oracle. They said they plan to "maintain and grow Cerner's community presence" including in the Kansas City area.
Oracle said the deal is expected to close in calendar year 2022. It's subject to some regulatory approvals and other closing conditions involving stockholders.
Cerner announced a new president and CEO in August.
It was also announced earlier this year plans to sell its Continuous Campus in Kansas City, Kansas.
Cerner still operates its World Headquarters, Realization Campus and Innovation Campus in Kansas City, Missouri; as well as the Riverport Campus in Randolph, Missouri, and the Lee's Summit Campus.
"Working together, Cerner and Oracle have the capacity to transform healthcare delivery by providing medical professionals with better information—enabling them to make better treatment decisions resulting in better patient outcomes," Larry Ellison said in a statement.
Oracle founder Ellison is worth about $124.8 billion, according to Forbes. In 2012, he purchased almost the entire Hawaiian island of Lanai for $300 million.