After struggling to capture the interest of new clients with its corporate softwares, Oracle Corp. is now looking to bolster its cloud-service with its newest acquisition. The American tech giant has agreed to acquire the very-first cloud service provider NetSuite in an all-cash deal valued at $9.3 billion.

Commenting on the acquisition and talking about creating synergies between the two companies, right off the bat, Mark Hurd, CEO, Oracle adds that,

Oracle and NetSuite cloud applications are complementary, and will coexist in the marketplace forever. We intend to invest heavily in both products—engineering and distribution.

The aforementioned deal had been rumored for months, as Oracle has been direly trying to shift its focus from building and selling corporate softwares. It has been looking to pivot to something more current and relevant — cloud —  which currently accounts for only a tenth of its business.

In terms of financial standing, Oracle has agreed to pay $109 per outstanding NetSuite share, amounting to a total of over $9.3 billion. This is a 19 per cent premium over the current closing price of the company on Wall Street. The acquisition is expected to close by the end of this year.

The acquisition doesn’t come as a surprise to anyone because Oracle co-founder Larry Ellison is an investor in NetSuite, the company he co-founded with Evan Goldberg in 1998. So, it is more than favorable for Oracle to acquire its acquaintance which goes back decades. Ellison and his family have about a 45 per cent in the cloud-service provider.

The acquisition deal was evaluated by a group of independent Oracle directors — excluding Ellison, reports Bloomberg. NetSuite, with a massive market capital of $7.37 billion, is seen as one of the first companies to distribute business applications on the Internet. This deal gives Oracle the chance to connect with more than 30,000 small and mid-size business.

Commenting on the acquisition deal, Zach Nelson, CEO, NetSuite adds that,

NetSuite will benefit from Oracle’s global scale and reach to accelerate the availability of our cloud solutions in more industries and more countries. We are excited to join Oracle and accelerate our pace of innovation.

He further goes on to add that the company has been operating cloud services for the past 18 years and believes that its combination with Oracle’s services will be a win-win situation for NetSuite’s customers, employees and partners.

This acquisition will also give Oracle the power to enter the realm of cloud services with a big bang, and take the fight back to the likes of Salesforce, Microsoft and SAP. Salesforce has created a fierce pool of rivals after achieving the top spot for its cloud-based enterprise CRM services. It has recently also acquired e-commerce analytics and CRM software company Demandware for a staggering $2.8 billion. Even Nadella-led Microsoft is now diverting its complete focus on cloud services and has steps to take on Salesforce with the introduction of its new integrated cloud platform ‘Dynamics 365’

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