With the deadline for the deal fast approaching, the German software giant extended its offer deadline for its US$ 5.8 billion cash offer for Sybase shares pending approval. With EU approval now in the bag, the deal is due to finally close next Monday.
Earlier this week SAP informed the US Securities and Exchange Commission that it had also reached an agreement on the terms of the deal with a number of shareholders who had filed a class action suit to block the sale, although there appeared to be little risk that the issue would derail the deal.
The closure of the deal probably couldn’t come at a better time for SAP as Sybase last week released its second quarter figures, which saw net income for the mobile and database technology developer jump by 20%. Revenues rose to US$ 302 million from US$ 278 million for the same quarter last year, representing an increase of 9%.
This was broken down into license revenue of US$ 100.1 million from US$ 94.1 (an increase of 6%), while services revenue rose 5% to $147.2 million, and messaging revenue up 24% to $54.8 million.
SAP and Sybase Technologies
This deal is about mobility. By making its software mobile, SAP expects a greater adoption of its products. As more companies become mobile with the Sybase mobile platform business users will be able to integrate their non-SAP products with SAP.
On the Sybase technology side, the addition of SAP’s in-memory technology is expected to greatly improve the mobile platform’s analytic processing, while Sybase’s database technology will also be enhanced by the in-memory technology to provide transactional and analytical abilities there.
At the time the deal was originally announced, SAP said it would not tie its applications exclusively to the Sybase database and force its customers to buy into the two, but that it would rather offer its customers choice to use SAP applications with whatever database they choose.
Also for Sybase users that may be concerned about future support and development, SAP has said it will support each organization’s product road map and develop current software products from each to ensure value from existing investments.
Both companies will also operate separately with organizations remaining intact and enhanced opportunities to cross-collaborate on projects.
SAP and Acquisitions
While SAP hasn’t exactly shied away from acquisitions in recent years, most of them since the US$ 6.8 billion acquisition of Business Objects in 2008 have been about acquiring technologies that they didn’t already have and didn’t have the time to develop in current competitive market conditions.
Jim Hagemann Snabe, co-CEO of SAP said they would be focusing on developing the parts of the stack that their customer base is particularly interested in, with many Sybase customers interested in the Sybase database technology.
If this doesn’t reassure Sybase customers then the chances are they won’t really have to long to wait to see a roadmap of where SAP intends to go. The deal is expected to close in the third quarter.