Oracle Buying Stake In Indian Banking Software CompanyOracle Buying Stake In Indian Banking Software Company

Continuing its push into vertical market applications, Oracle said Tuesday it will acquire a majority interest in Indian banking-software maker i-flex Solutions Ltd.

Oracle will purchase the 41% stake in i-flex currently owned by Citigroup Venture Capital. As required by Indian law, Oracle will then make an open offer to purchase an additional 20% of the company's outstanding shares. The value of the acquisition is put at $316 million, assuming that the entire 20% of outstanding shares are tendered. The transaction is expected to close by the end of the year.

Mumbai-based i-flex develops applications for corporate banking, consumer banking, investment banking, Internet banking, asset management, and investor services. Products include the Flexcube core banking software, Revelus business-analysis application, and Daybreak consumer-lending applications.

I-flex's software has run on Oracle's platform software since 1997 and more than 90% of i-flex customers use Oracle software, according to Oracle. Its products are used by 575 banks in 115 countries.

The current i-flex management team will continue to run the company, according to Oracle, and will align its product-development, sales, marketing, and service operations with Oracle. Oracle president Charles Phillips will join the i-flex board.

After completing its acquisition of enterprise-resource-planning application vendor PeopleSoft earlier this year, Oracle has turned its attention to building out its portfolio of software for vertical markets. Last month the company acquired retail application developer ProfitLogic Inc., and in April bought Retek Inc., another retail-software supplier.