Will create a comprehensive cloud offering for organizations to manage their human resource operations and employee careers, says Oracle.

Oracle said that it has entered into an agreement to acquire Taleo Corporation, a provider of cloud-based talent management for approximately $1.9 billion.

Talent Management Cloud solution from Taleo offers organizations to attract, develop, motivate and retain human capital to improve performance and drive growth.

The Board of Directors of Taleo has unanimously approved the transaction. The transaction is expected to close mid-year 2012, subject to Taleo stockholder approval, certain regulatory approvals and other customary closing conditions.

“Human capital management has become a strategic initiative for organizations,” said Thomas Kurian, Executive Vice President, Oracle Development. “Taleo’s talent management cloud is an important addition to the Oracle Public Cloud.”

Together, Oracle and Taleo expect to create a comprehensive cloud offering for organizations to manage their human resource operations and employee careers, said a company release.

“Taleo’s integrated cloud-based talent management solutions optimize how organizations hire, manage, develop and reward their employees and gives companies the intelligence needed to capitalize on their most critical asset, their people,” said Michael Gregoire, Chairman and CEO, Taleo.

In October last year, Oracle had acquired RightNow Technologies for approximately $1.5 billion.

Oracle counters SAP

The Taleo acquisition for Oracle comes at a time when SAP acquired US-based SuccessFactors, a provider of cloud-based human capital management solutions, for $3.4 billion in December.

Taleo and SuccessFactors have been competitors.

Paul Hamerman an analyst at technology research group Forrester wrote in his blog that by acquiring SuccessFactors, SAP has put itself into a much stronger competitive position in human resources applications and reaffirms its commitment to software-as-a-service as a key business model.

The cloud computing market is buzzing with merger and acquisition action lately as players seek to gain competitive advantage and market share.

Forrester estimates the cloud computing market to grow from $40.7 billion in 2011 to more than $241 billion in 2020.