Extending its battle with German rival SAP further into the governance compliance arena, Oracle has acquired LogicalApps, a company backed by Sequoia Capital and Mission Ventures.
Terms of the deal, announced Tuesday, were not disclosed, but integrating Irvine, California-based LogicalApps is expected to give Oracle more firepower in automating fraud control and documenting for compliance procedures.
In 2002, Congress passed the Sarbanes-Oxley Act in the wake of corporate scandals at Enron and WorldCom. That bill tightened financial reporting and compliance standards for public companies, prompting a boomlet in the market for specialized software.
Forrester Research analyst Michael Rasmussen likened the Oracle-SAP rivalry to a prize fight.
“Oracle launched itself into the governance, risk, and compliance market to go toe-to-toe against SAP,” he wrote in a June research note. “Oracle's strength is in the content and process management for GRC, while SAP shines in automated process and access controls. As these large rivals battle one another, neither can afford to ignore the smaller, nimble vendors in this space.”
In 2006, SAP made its own governance and compliance acquisition, snagging Virsa Systems for an undisclosed amount.
LogicalApps software was tailored to work with Oracle business applications, but in a statement on the acquisition, an Oracle executive said the company plans to extend its governance software to work with business software from JD Edwards, Hyperion, SAP and other non-Oracle applications.
“Oracle continues to be committed to plans for building a comprehensive, open and integrated enterprise governance, risk, and compliance application suite designed for heterogeneous environments,” said James Wookey, Oracle’s senior vice president of applications development.
Seven-year-old LogicalApps, whose lengthy customer list includes Cisco Systems, General Dynamics, and California Institute of Technology, took only one round of venture capital before its acquisition. In that funding, Sequoia and Mission injected a $14 million first round in October 2005 to expand sales and marketing.