Monday, August 09, 2010

SAP Puts No Price Limit for Acquisitions but Focuses on Organic Growth First

After announcing a strong quarter, SAP, the listed German software group, has no price barrier when it comes to acquisitions, Boersen-Zeitung reported. Werner Brandt, the chief financial officer at SAP, told the German daily during a lengthy interview that his company acquires to gain access to technology that can speed up its growth, which why he does not believe in price barriers or maximum result multiples. However, Brandt made clear in the paper that SAP should have a positive net liquidity at all times and that a negative net liquidity should only be tolerated for a short while after acquisitions.

Brandt reaffirmed that SAP is currently focusing on organic growth and believes that the company can grow by more than 10% organically again in the future.

SAP must catch up with Oracle, the king of dealmaking in the high-tech world. My long time friend and old colleague Bill McDermott is up to the challenge of putting SAP back on track to grown in double digits. He just might need to have a bold dealmaker on his staff to face up Oracle.
SAP itself remains as a target to IBM, HP, Oracle and Microsoft.  Microsoft and Oracle are rumored to have looked t SAP multiple times unable to close the deal.
SAP has a market cap of about 43 billion euros

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