U.S. software giant Oracle took a majority stake in India’s i-flex, officials announced Tuesday.
The Redwood Shores, Calif., company announced its plans to buy Citigroup Venture Capital International’s 41 percent majority position in the Mumbai, India-based company, though the deal is subject to regulatory approval.
Under Indian law, Oracle is also required to offer to buy up as much as 20 percent from other i-flex shareholders. The cost could reach $316 million if the entire 20 percent of shares is sold under the plan. Oracle officials said they plan to open the offer in the beginning of August.
I-flex is the largest software company in India, Oracle said, developing applications for the financial services industry that include investment banking, consumer banking, asset management and investor services.
“Banking is a strategic industry for Oracle, with nine out of the top 10 banks already running Oracle ERP applications,” Larry Ellison, Oracle CEO, said in a statement. “Oracle’s overall application strategy is to go beyond ERP and offer customers richer industry-specific functionality. I-flex gets us there in banking.”
The Indian company will continue to operate out of its headquarters in Mumbai and will be managed by its current team, officials said, though product development, sales, marketing and services will be more closely aligned with Oracle.
Roughly 90 percent of the i-flex customer base of 575 banks in 115 countries uses Oracle. The company doesn’t plan to alienate other vendor hardware and software platforms, notably IBM. Big Blue makes up a key constituency in the i-flex customer base, said Charles Phillips, Oracle president.
“The i-flex products will continue to run on IBM software and hardware, and our relationship with i-flex aligns us more closely with IBM solutions for our joint banking customers,” he said in a statement. “In addition, Citigroup remains a committed and loyal customer of i-flex, having recently entered into a five-year product and services agreement.”
