SAP to buy SuccessFactors in cash deal
Source: Agencies |
December 5, 2011, Monday
|
Print Edition
Print Edition
GERMANY'S SAP announced a US$3.4 billion cash deal to buy United States web-based software company SuccessFactors, joining the scramble among technology firms to offer cloud-computing services to businesses.
SAP said on Saturday it would pay US$40 per share for SuccessFactors, a premium of 52 percent over both its Friday closing price and the one-month volume-weighted average price, making it expensive for any rival bidder that might want to put in a counter bid.
SuccessFactors, which first went public at US$10 a share four years ago, makes human resources software used by companies to review employee performance, It competes with Taleo Corp and Kenexa Corp.
The deal helps SAP catch up in cloud computing, a fast-growing field where data and processes are hosted remotely on the web. Analysts have warned that SAP risked losing ground to US rival Oracle Corp.
Oracle in October announced a US$1.5 billion deal to buy cloud computing firm RightNow Technologies Inc, a rival of SAP. Salesforce.com pioneered cloud computing for companies and is still the market leader in the field.
Paul Hamerman, an analyst at technology research group Forrester, said SAP was paying a substantial premium to acquire SuccessFactors but its own cloud strategy had been lagging.
Forrester estimates the cloud computing market will grow from US$40.7 billion in 2011 to over US$241 billion in 2020.
SAP said on Saturday it would pay US$40 per share for SuccessFactors, a premium of 52 percent over both its Friday closing price and the one-month volume-weighted average price, making it expensive for any rival bidder that might want to put in a counter bid.
SuccessFactors, which first went public at US$10 a share four years ago, makes human resources software used by companies to review employee performance, It competes with Taleo Corp and Kenexa Corp.
The deal helps SAP catch up in cloud computing, a fast-growing field where data and processes are hosted remotely on the web. Analysts have warned that SAP risked losing ground to US rival Oracle Corp.
Oracle in October announced a US$1.5 billion deal to buy cloud computing firm RightNow Technologies Inc, a rival of SAP. Salesforce.com pioneered cloud computing for companies and is still the market leader in the field.
Paul Hamerman, an analyst at technology research group Forrester, said SAP was paying a substantial premium to acquire SuccessFactors but its own cloud strategy had been lagging.
Forrester estimates the cloud computing market will grow from US$40.7 billion in 2011 to over US$241 billion in 2020.
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