German business software giant SAP has acquired rival Sybase in a transaction worth US$5.9bn. Under the terms of the deal, SAP will make an all-cash offer for shares of Sybase at US$65 per share.
The per share purchase price represents a 44pc premium over the three-month average stock price of Sybase. The transaction will be funded from SAP’s cash on hand and a €2.75bn loan facility arranged and underwritten by Barclays Capital and Deutsche Bank.
The Sybase board of directors has unanimously approved the transaction.
The deal will allow SAP to accelerate the reach of its solutions across mobile platforms and drive forward the realisation of its in-memory computing vision.
In addition, Sybase’s innovative mobile platform can connect all applications and data (SAP and non-SAP) and enable them on mobile devices. SAP, Sybase and their customers will be able to tap into Sybase’s messaging network to reach 4 billion mobile subscribers through 850+ operator relationships worldwide and engage their consumers via alerts, transactions and promotions on their mobile devices.
“With this transaction, SAP will dramatically expand its addressable market by making available its market-leading solutions to hundreds of millions of mobile users, combining the world’s best business software with the world’s most powerful mobile infrastructure platform,” said Bill McDermott, co-CEO of SAP and member of the SAP executive board.
“This is a game-changing transaction for SAP and Sybase customers, who will be better able to connect their employees with key functionality and information from anywhere and make it easier for companies to make faster, more informed business decisions in real time. With SAP’s customer-centric approach, we are resolute in our commitment to support Sybase customers to be best-run businesses.”
SAP said it will continue to support each organisation’s product road map while enhancing products to help customers derive additional value from existing investments.
“Mobile devices are becoming the preferred interaction point with business applications, whether the user is a factory supervisor, a retail manager or an entrepreneur in a developing nation,” said Jim Hagemann Snabe, co-CEO of SAP and member of the SAP executive board.
“The combination of SAP and Sybase will give users the option of running their operations from leading mobile devices and will unleash the full power of mobility, including messaging interoperability, content delivery and mobile commerce services, across all companies and roles and in any location. In addition, innovation around Sybase’s established database business will pave the way for ‘real’ real-time analytics and finally remove the decade-old barrier between business applications and business intelligence.”
Sybase to operate stand-alone
The two companies announced that Sybase will operate as a standalone unit under the name “Sybase, an SAP Company.”
“This combination is a transformative event in the software industry,” said John Chen, CEO of Sybase, Inc. “SAP’s in-memory technology in combination with Sybase’s database technology will revolutionise how transactional and analytic applications are built, benefiting all businesses.
“By combining the market leader in enterprise applications with the market leader in enterprise mobility, companies around the world will be able to run their business from many devices. This will drive a new wave of enterprise productivity.
“The combined SAP/Sybase will be able to provide a software offering that enables companies to transform their businesses in an increasingly data-, consumer- and mobile-centric world,” Chen said.
By John Kennedy