July 6, 2005, 12:00 AM

Oracle continues to build retail platform with plan to buy ProfitLogic

Following its acquisition of Retek, a provider of retail enterprise software, Oracle has signed an agreement to buy ProfitLogic, a provider of web-based software that helps merchants analyze customer demand to set pricing and merchandising strategies.

Kurt Peters

Executive Editor

Following its acquisition earlier this year of Retek Inc., a provider of retail enterprise software, Oracle has signed an agreement to buy privately held ProfitLogic Inc., a provider of web-based software that helps merchants analyze customer demand to set pricing and merchandising strategies. Terms of the deal were not disclosed.

Scott Friend, who will remain as president of ProfitLogic under the Oracle organization, said the acquisition will grant his company the resources it needs to expand services and serve a larger group of retailers. “This powerful combination will enable us to accelerate our ability to drive dramatic financial improvement for a larger set of leading retailers worldwide,” he said.

“With ProfitLogic`s Retail Profit Optimization software, Retek`s end-to-end retail products, and Oracle`s infrastructure software and ERP applications, we will be able to offer an integrated solution for retailers of any size and in any industry," said Duncan Angove, general manage of Oracle’s Retek Global Business Unit.

By adding ProfitLogic to its stable, Oracle will now appeal more to apparel and other softlines retailers who need applications to manage fashion-oriented, short-lifecycle products, Alexi Sarnevitz, analyst with AMR Research Inc., said in a report issued this week, “Oracle Acquires ProfitLogic: The Drive to Lead in Retail Continues.”

“While Retek’s enterprise footprint established a powerful retail foundation for Oracle in its hyper-competitive battle with SAP, the ProfitLogic technology significantly enhances Oracle’s core merchandising and demand analytic abilities,” Sarnevitz said. “ProfitLogic, the leader in price optimization for softlines retailers, has emerging planning and allocation capabilities that further capitalize upon its demand analytics platform. These softlines’ abilities complement Retek’s (now Oracle’s) demand intelligence platform that historically was more applicable to longer lifecycle, hardlines-oriented merchandise.”

ProfitLogic`s current customers include retailers American Eagle Outfitters, Ann Taylor, Bloomingdale`s, The Children`s Place Retail Stores, Famous Footwear, Reitmans, J.C. Penney, Marshall Field`s, Nordstrom, ShopKo Stores, and Toys R Us.

Oracle this year also acquired PeopleSoft, a provider of enterprise software including applications used by retailers for managing customer relationships, finances and supply chains.

"Since we rely on ProfitLogic, Oracle, Retek and PeopleSoft as strategic technology partners that help us manage and grow our business, we feel this is a positive move for us and the industry as a whole," said Doug Deruchie, CFO of Reitmans, Canada`s largest women`s specialty retailer. "The synergy that will be created by combining these industry leaders will enable Reitmans to get to the next level of performance faster and far more efficiently than we had anticipated when we chose each independently."

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