Wednesday, July 28, 2010

SAP Looking for More Strategic Acquisitions after Sybase Takeover

According to a report in Die Welt, SAP, the listed German software group, is interested in further acquisitions after the takeover of California-based rival Sybase. Jim Hagemann Snabe, the co-chief executive of SAP, told the newspaper that strategic acquisitions remain part of the strategy after the Sybase deal, but added that one should not expect a string of takeovers similar to the mentioned recent deal.

A separate report in German daily Frankfurter Allgemeine Zeitung noted that SAP announced that it has secured 92% in Sybase after filing a EUR 4.6 B takeover offer.

Under the new leadership, SAP realized they needed to get more aggressive with acquisitions against the king of M&A, Oracle. I would expect SAP to participate in every deal to be made in the Information Technology domain going forward. Oracle who is always looking for bargain prices might find future deals more contested and difficult to creat economic value with higher valuation multiples.

SAP could look at firms in the hosted cloud infrastructure space cherry picking Infrastructure-as-a-Services (IaaS) and Platform-as-a-Service (PaaS) companies. Another segment is enterprise search and content managent to augment their platform with unstructured data access, management and mining to complement their Sybase and Business Objects acquisitions.
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