Oracle president Charles Phillips claimed last week that the company could spend $70 billion on acquisitions in the next five years, and now the company is scrambling to take back the message.
During the Fortune Brainstorm Tech conference in Aspen, Colo., on Thursday, Phillips was asked about Oracle’s acquisition strategy during a Q&A session.
“If you look forward, you know, for the next five years, we’ll probably double what we’ve spent on acquisitions for the last five years,” he said.
Phillips said that Oracle spent about $35 billion on acquisitions in the last five years and answered a follow-up question asking whether the company could really spend $70 billion in the next five.
“If things hold up, we could easily do that,” he said.
If that were to happen, Oracle would need to set an even more frenzied pace of acquisitions than it has in the past five years, when it made about three dozen purchases. Either that or it would have to make a big, multibillion-dollar blockbuster acquisition. In the last five years, the biggest Oracle acquisitions have been BEA for $8.5 billiion, Sun Microsystems for $7.4 billion and Siebel Systems for $5.85 billion.
The Oracle PR machine immediately went to work following Phillips’ comments. By the next morning, they had jumped on the issue with a press release.
“Oracle does not have a five-year acquisition budget,” the complete statement reads. “We don’t even have a one-year acquisition budget. While it is highly unlikely that we will spend anything approaching $70 billion in five years, we will be opportunistic and, if market conditions warrant, we will buy additional companies that further our strategic goals and address our customers’ needs.”
During his interview, Phillips also said that “there are a lot of companies in the vertical markets that no one’s ever heard of that would be nice to have.”
According to Josh Greenbaum, an analyst with Enterprise Applications Consulting, the Oracle acquisition mix-up is probably all due to the old WWII warning: Loose lips sink ships.
“I don’t think Charles Phillips is out of the loop per se,” Greenbaum said. “I think there is a serious corporate policy about being very tight-lipped regarding money, forward-looking statements and anything else. It’s most likely that the correction was made because they have some very, shall we say, aggressive lawyers inside the company who really frown on anything resembling a forward-looking statement.”
Mark Fontecchio can be reached at [email protected].