Oracle (ORCL) isn't interested in buying a services company such as Accenture PLC (ACN), but it might buy a chip company, Chief Executive Larry Ellison said Thursday.

"Our services are very focused on Oracle and only Oracle products," he said at the company's analysts meeting here. That means it wouldn't make sense for Oracle to buy a services firm that sells services for products from competing companies. "So I don't think you'll see us go into that area," he said, adding that Oracle will continue to partner with services companies such as Accenture.

On the other hand, Oracle is interested in any new technology it can tuck into its existing products, such as the powerful servers it has been selling since acquiring Sun Microsystems Inc. in January for $5.6 billion.

"You could see us buy a chip company," Ellison said in response to an analyst's question about the Redwood Shores, Calif.-based company's acquisition strategy.

The remarks come at a time of heightened merger-and-acquisition activity in the technology sector. Last week, PC maker Hewlett-Packard Co. (HPQ) offered roughly $1.5 billion for security-software maker ArcSight Inc. (ARST), a move that followed the PC maker's earlier acquisitions of 3Par Inc.(PAR), the privately-held Fortify Software Inc. and Palm Inc. In August, semiconductor maker Intel Corp. (INTC) said it would buy McAfee Inc. (MFE), a leading software security firm, for $7.7 billion.

Oracle will be part of that trend. Earlier in the day, Chief Financial Officer Jeff Epstein said the company is still looking for technology companies to acquire.

"We will continue to make small and large acquisitions," Epstein said.

Epstein also touted the company's acquisition record, saying that the business-software maker expanded its non-GAAP operating margin to 46% in fiscal 2009, up from 39% in fiscal 2004. The improvement came after the acquisition of several companies, including PeopleSoft, Siebel, Hyperion, Bea and Sun, which all had non-GAAP operating margins below 20%, he said.

Oracle shares, which weren't active after hours, closed down 0.3% on Thursday at $27.12.

-By Jeanette Borzo, Dow Jones Newswires; 415 765 8230; jeanette.borzo@dowjones.com
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