Larry Ellison thinks Michael Dell is 'brilliant' for buying EMC and will 'make billions personally'

Oracle's billionaire founder Larry Ellison has nothing but high and heavy praise for Michael Dell and his pending acquisition of EMC.

Though he also says he's heartbroken that he can't snatch EMC away from Dell.

"I think it's brilliant. My friend Jim Davidson and my friend Michael Dell have done a spectacular job in engineering that EMC deal," Ellison said when a Wall Street analyst asked him about it on Thursday. (Davidson is a managing partner at private equity firm Silver Lake, the major financier of the $67 billion deal.)

"They are all going to make billions of dollars," Ellison said. "Michael is going to make billions personally. So hats off to them. Its a fabulous, fabulous deal."

Ellison made the comments during a Q&A with Wall Street analysts on Thursday, during Oracle's huge tech conference that took place this week in San Francisco.

He also said that he thought about trying to buy EMC and only rejected the idea because the timing wasn't right for Oracle.

"I can tell you, we're not bidding for EMC. But I shed more than a couple of tears. God we could make a lot of money, a LOT of money, if we bought EMC at that price."

The only reason he's not jumping in with a rival bid is because Oracle needs to focus all of its efforts on building out its all-important new cloud computing business, especially its software-as-a-service cloud (SaaS) and platform-as-a-service cloud (PaaS).

Both of of these let companies rent applications and app-hosting platforms as subscription services over the internet.

Ellison explained:

It kind of breaks our hearts. ... But we're not going to do it, because, like I said, we're singularly focused on one thing and that's making sure we're the No. 1 SaaS provider and the No. 1 PaaS provider and the next two years are going to be crucial for us achieving those goals.

This would be a big distraction. The wrong message to the marketplace, the wrong message to our people. A big distraction for our senior managers. But boy, we could make a lot of money. It's the kind of an opportunity that's bad timing for us. It's an opportunity we're going to miss.

Again, Jim Davidson is a brilliant guy. Michael Dell is a brilliant guy. They saw the opportunity for this consolidation, to buy a business that is out of fashion.

And the market prices things very interestingly. If you're highly fashionable, you get these wild P/Es. If you're an unfashionable company, just because you throw off tons and tons of cash, no one seems to care.

But Jim Davidson cares. Michael Dell cares. [They said,] 'We'll take that.' ... "

Ellison said that

EMC is "unfashionable" right now because its core computer storage business is built with "last generation" technology.

But EMC has "a huge installed base, it's going to throw off a whole lot of cash, it's going to be around for a long time and the people that own it are going to make a lot of money," he said. "So good job Michael and Jim."

But that doesn't mean that Oracle won't do its own EMC-like deal and buy a big, undervalued competitor when the time is right.

Analysts asked him what he plans to do with Oracle's stockpile of $56 billion in cash and he said, "We haven't made any large acquisitions for a while. You know? We're kind of saving our nickels and dimes. We might do something interesting, one of these days. Not anytime soon."