Oracle buying BPM vendor Collaxa, sources say

SAN FRANCISCO - Oracle Corp. is acquiring software startup Collaxa Inc. in a move to strengthen its application server by adding technology that will make it easier for companies to automate business processes, sources familiar with the plan said.

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Most of the large middleware vendors, including IBM Corp. and BEA Systems Inc., have been adding business process management, or BPM, capabilities to their application servers. Several pure-play vendors, including Action Technologies Inc. and Intalio Inc., are also in the market.

Oracle hopes to bolster its Application Server 10g software by adding technology from Collaxa to the product, industry sources said. Based in Oracle's home town of Redwood Shores, California, privately-held Collaxa was founded in 2000 by employees from the former Netscape Communications Corp. and NetDynamics Inc., among others.

Oracle would not confirm or deny any plans to buy Collaxa. "We do not comment on rumors or speculation," said Oracle spokeswoman Letty Ledbetter. Collaxa's chief executive did not return calls and e-mails seeking comment on Monday. Two weeks ago he said his company was not being acquired by Oracle.

However, two sources familiar with the deal said this week that Oracle is putting the finishing touches on the acquisition and plans to announce it at Sun Microsystems Inc.'s JavaOne show, which starts June 28 in San Francisco. "This is going to significantly improve (Oracle's) ability to manage business processes," one of the sources said.

Collaxa's main product is called BPEL Server. It supports the Business Process Execution Language, a specification backed by Microsoft Corp., IBM, SAP AG and BEA, and used primarily by companies using Web services applications.

Web services provides a way for companies to integrate their business applications using standard interfaces. BPEL provides a method for coordinating the functions of those applications into a business process.

Oracle already has added some BPM capabilities to its application server, noted Shawn Willett, a principal analyst with Current Analysis Inc. "They've been slowly building that functionality; they must have figured it would be quicker and easier to buy a product," he said.

Collaxa's product includes a runtime server, visual modeling and management tools. It supports several standards and specifications including BPEL 1.1 and the Web services standards WS-Addressing, WS-Transaction and WS-ReliableMessaging.