In yet another tech mega deal in recent weeks, SAP announced on Sunday afternoon that it has agreed to buy Business Objects in a $6.8 billion deal.
The acquisition, which is expected to close in the first quarter of 2008, is SAP's largest acquisition. As noted by various sources, this deal is noteworthy in that SAP has a history of tending to develop its own technology rather than acquiring it.
Business Objects is a leader in the rapidly growing market of business intelligence (BI) software. SAP has said that it plans to combine its software offering BI vendor's products to offer customers real-time information about their businesses.
"This is part of its previously announced strategic plans to double its addressable market by 2010," said Henning Kagermann, SAP's chief executive, during a press conference on Sunday morning. "Together, we have almost 5,000 business partners. I think it will be a formidable force as we put our solutions together," he added.
SAP, analysts say, needs to add more capabilities to its software to increase sales and prompt customers to buy new versions. The promise that business intelligence software might be able to glean insights from the data flowing through SAP’s enterprise planning system could justify the price of the Business Objects purchase, industry analysts say.
- SAP to buy maker of business software (The New York Times)
- SAP to acquire France's Business Objects (The Wall Street Journal)
- SAP buys Business Objects for €4.8bn (MSNBC.com)
- SAP buys Business Objects for 4.8 billion euros (Forbes.com)
- Update: SAP to buy Business Objects in $6.8B deal (ComputerWorld)
Oracle acquired Hyperion, a small rival of Business Objects, for $3.3 billion in March. With the Business Objects acquisition, SAP will certainly be better positioned to compete against Oracle.
Paul Mah is a writer and blogger who lives in Singapore, where he has worked for a number of years in various capacities within the IT industry. Paul enjoys tinkering with tech gadgets, smartphones, and networking devices.