Tuesday, October 18, 2011

Oracle plans Endeca acquisition

By James M. Connolly

Database and applications software giant Oracle Corp. today said that it has reached an agreement to acquire rapidly growing search and data management technology firm Endeca Technologies Inc. of Cambridge.

The announcement comes less than four months after Endeca CEO Steve Papa, who founded the company in 1999, discussed how his company was gearing up for an initial public offering. At that time Papa said his company was not a candidate to be acquired. “We think we’re still in the early stages of two very large markets,” he said, referring to the company’s two business lines — search engines for commercial websites and search/analytics tools for internal business intelligence.

Endeca, which offers tools to help companies manage unstructured data, had reported revenue of $150 million in annual revenue from 600 customers such as Walmart, IBM, Toyota, General Mills, Land O’Lakes, Aramark, PETCO and Tiffany.

No financial details on the deal, which is expected to close by the end of the year were released.

Redwood Shores, Calif.-based Oracle, which based years of growth on its relational database technology, said in a press release that the convergence of structured and unstructured information — including resources such as photos, audio, video and printed materials — “is driving the need for a common data management and analytics platform.”

Endeca’s core technology is its MDEX Engine, which analyzes unstructured data. It also offers Endeca InFront, which is designed to help businesses develop merchandising and content targeting tools for web commerce, and
Endeca Latitude, which is used to develop analytic applications that bringing together information from unstructured and structured information sources.

Oracle said that the combination of Oracle ATG Commerce and Endeca InFront “is expected to enhance cross-channel commerce, merchandising, and online customer experiences,” which Oracle Business Intelligence and Endeca Latitude will provide a business intelligence foundation using structured and unstructured data sources.

Endeca, which employs 250 in Massachusetts and 450 overall, has been backed by $70 million in equity investment from investors including Bessemer Venture Partners and Ampersand Capital Partners. The company’s last fundraise – a $25 million round – came in 2008.

In an Oracle press release, Papa said, “We bring successful deployments with large enterprises in key industries such as retail, distribution, media and publishing, government, and manufacturing and consumer packaged goods – many of these customers are also Oracle customers.”