Business software giant Oracle Corp. will buy LogFire Inc., a provider of cloud-based warehouse management systems (WMS) and one of its key partners, to help Oracle complete its portfolio of supply chain management applications in an effort to compete with logistics technology specialists like Manhattan Associates Inc. and JDA Software Group Inc.
Redwood Shores, Calif.-based Oracle and Atlanta-based LogFire announced last year they had joined forces to create what they claimed to be the first-ever integrated transportation and warehouse suite tailored to the cloud. Logfire has been a player in the logistics industry's migration from tailored, on-premise software installations to cloud-based applications that can be managed from remote locations. LogFire's platform provides an integrated warehouse, inventory, and workforce management application.
Oracle announced the deal Tuesday but did not give a specific date for when the acquisition would close or the price it paid. The company declined to answer questions and referred queries to its press release announcing the deal and related filings.
Oracle's challenge is to add LogFire's cloud-based warehouse management capabilities to its Oracle Supply Chain Management (SCM) Cloud. Together, the combined applications will allow supply chain organizations to keep up with industry trends including omnichannel fulfillment, integrated logistics, and dynamic sourcing, the company said.
Oracle said it was "currently reviewing the existing LogFire product roadmap" and would notify customers of future changes. In the meantime, Oracle said it planned to add LogFire's employees and management team to its SCM Cloud division, and continue to support LogFire's products.
However difficult the merger process may be, Oracle has already succeeded by impressing investors with its purchase of a company in the popular software-as-a-service (SaaS) sector, said Steve Banker, service director for Supply Chain Management at ARC Advisory Group. "The financial analysts are bullish on SaaS revenues, and Oracle is eager to make Wall Street happy," Banker said.
Oracle's acquisition means it can now finish the job it started when it announced the provisional partnership with LogFire a year ago. At that time, the two firms took baby steps toward integrating their cloud-based transportation and warehouse suites, but they couldn't break into full stride until they were fully merged, he said. "They had integrated the solutions, but having solutions build on common master data, which can run on the same data, makes the applications seamless," Banker said. "Without an acquisition, it is doubtful that those things would be achieved."
If Oracle can get it right, the acquisition would help to close functionality gaps in its supply chain software offering and keep pace with "best of breeds" like Manhattan and JDA, said Banker.
Gartner, Inc.