The US arm of SAP has confirmed it is buying mobile management software company Sybase for US$5.8 billion (A$6.45 billion), a 50 percent premium on the current stock price after trading rose on the rumour of a bid.
SAP is looking to field a stronger portfolio and the purchase will give it a footing in the mobile sector. This is the second acquisition by SAP in a month, indicating the company is expanding operations while purchase prices are low.
“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-chief executive of SAP.
“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.
The deal is expected to be concluded by the end of the year and will see Sybase run as a separate unit within SAP. However the company will be using Sybase's technology to extend its own software into the mobile market.
“This combination is a transformative event in the software industry,” said John Chen, chief executive of Sybase.
“SAP’s in-memory technology in combination with Sybase’s database technology will revolutionise how transactional and analytic applications are built, benefiting all businesses."
Correction: This article ran for a few minutes under the headline that the acquisition was worth only $650 million. Apologies for the error. At least it didn't set the Dow Jones crashing 1000 points.