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Oracle aiming to acquire chipmakers

CEO Larry Ellison plans to add to his lineup of acquisitions by picking up semiconductor companies in an attempt to own more of the technology behind computer chips.

Following a string of acquisitions the past few years, Oracle CEO Larry Ellison is now setting his sights on buying into the semiconductor market.

Oracle CEO Larry Ellison
Oracle CEO Larry Ellison Dan Farber/CNET

In a Q&A at Oracle's financial analyst meeting yesterday, Ellison said he would be interested in acquiring a chipmaker as part of an effort to own more of the intellectual property behind computer chips. The CEO said that he wants to follow the approach of Apple, which has bought semiconductor manufacturers to help it produce the iPhone and iPad, according to Bloomberg News.

"Our focus is to build our (intellectual property) portfolio...You could see us buying chip companies," Ellison said, according to Reuters. "Silicon is very important, software IP is very important."

Oracle's quest to move beyond its software roots and integrate hardware into its lineup was established by its $7.5 billion purchase of Sun Microsystems. Now the company could be looking to pick up a chipmaker with server technology, Doug Freedman, an analyst at Gleacher & Co., told Bloomberg. The analyst cited AMD, Nvidia, and IBM's chip division as possible candidates.

Ellison threw out another tidbit at the meeting, saying he'd like to have the 60 percent of NetApp's business that integrates NetApp servers with Oracle software. The Register saw this as a tipoff that Ellison may be eager to acquire NetApp.

"We [Oracle] love that business," Ellison said, according to the Register. "We would love to have that 60 percent. Do we need to acquire? I think there are some interesting technologies we'd like to acquire...I think it is possible."

Beyond hardware, the database giant also wants to expand in the software market. Ellison told analysts at the meeting that he plans to acquire more software companies that make products focused on specific industries. By adopting such a strategy, Oracle is looking to distinguish itself from its main rival SAP, which tends to rely more on internal growth.

The analyst meeting came at the tail end of Oracle's OpenWorld event, in which the company tried to get past the recent turmoil with HP over the hiring of its former CEO Mark Hurd as Oracle co-president. HP Executive Vice President of Enterprise Business Ann Livermore even delivered the first keynote speech, addressing concerns about the HP-Oracle partnership by stating that "HP has made a big investment" in supporting Oracle software and customers.