Oracle teams with Citigroup for B2B

Oracle has joined with US financial services giant Citigroup to attack the business-to-business (B2B) market in a bid to strengthen its applications software capabilities.

As part of the deal, Citigroup will power Oracle's online exchange - OracleExchange.com - with its payment and settlement capabilities, as well as implement the software maker's Internet Procurement system internally. The bank will also market OracleExchange to its corporate clients.

Citigroup also becomes the first strategic affiliate of OracleExchange, and will participate in the online trading portal. Oracle claims that members of its trading community shave 20 per cent off their annual procurement costs and get access to services from financial institutions and freight carriers.

Investors have been dumping Oracle's shares since the middle of October when, in its quarterly financial statement, the software giant revealed that its revenues from applications software were less than spectacular.

The company has seen its share price plummet from $46 in mid-August to $24 on Monday. The price rallied to $28 on Tuesday, after the announcement of the Citigroup deal.

Some analysts approved the alliance, saying that the applications market is important to emphasise as the database sector begins to mature.

Eric Upin, an analyst at Robertson Stephens, said: "Applications represent the next major engine of growth for Oracle. Customer relationship management, supply chain collaboration and B2B ecommerce are significant opportunities for Oracle to enhance the size of its target market."

Financial details of the alliance were not disclosed.