Austin, Texas-based enterprise software provider Oracle Corp. has announced it reached an agreement to acquire Cerner Corp. at an enterprise value of about $30 billion. As a result, we placed our ratings on Oracle on CreditWatch with negative implications. Nevertheless, we believe the company will likely retain an investment-grade rating, though doing so will probably require some curtailment of share buybacks. We will monitor developments related to the proposed acquisition and resolve the CreditWatch placement after we have a better understanding of Oracle's balance sheet management plan. Despite these challenges, Cerner grew revenues by mid-single-digit percentages in 2019, and it returned to growth after a rebasing year in 2020 that included culling unprofitable contracts and divesting businesses. Cerner provides Oracle
