Oracle is to acquire cloud company NetSuite in a $9.3bn deal that is expected to close before the end of the year.
NetSuite CEO Zach Nelson, who has been at the helm of the company since 2002, said that NetSuite will benefit from Oracle's size and "global scale".
This will allow NetSuite to "accelerate the availability" of its cloud services to more industries and more countries, according to Nelson.
Evan Goldberg, who founded NetSuite in 1998 and remains chairman and chief technology officer, added: "NetSuite has been working for 18 years to develop a single system for running a business in the cloud. This combination is a winner for NetSuite's customers, employees and partners."
Oracle CEO Mark Hurd claimed in a statement that NetSuite's cloud applications, which tend to be targeted at small and mid-sized businesses, will continue and co-exist alongside Oracle's cloud applications.
"We intend to invest heavily in both products: engineering and distribution," he said.
The evaluation and negotiation of the transaction was led by a special committee of Oracle's board consisting solely of independent directors, claimed Oracle, and the committee approved the transaction unanimously.
NetSuite was founded in 1998 as NetLedger, and was one of the first cloud services companies when they were known as application service providers.
Goldberg's original vision was web-hosted accounting software, but the suite of offerings grew to include HR, orders and inventory, shipping and billing, e-commerce, retail, content management and customer relationship management. NetSuite claims more than 30,000 customers, most of which are SMEs.
The company was initially backed with around $125m in funding from Oracle founder Larry Ellison via his Tako Ventures investment business, alongside StarVest Partners, HR software company ADP and UBS PaineWebber.
NetSuite floated on the New York Stock Exchange in 2007. The firm achieved revenues of $741m in 2015, but posted a net loss of $124.7m.
The company was valued at $7.37bn on the New York Stock Exchange this morning, before the deal was announced.
However, Ellison and family already own just over 45 per cent of the company, and completing the acquisition should therefore be a formality as it is unlikely that any rival suitor will emerge in an attempt to outbid Oracle.
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