Monthly News International
SAP buys Ariba
SAP America, a wholly owned subsidiary of SAP AG, has signed an agreement to acquire Ariba, a provider of collaborative business commerce solutions, for an all cash deal of $4.3 billion. The Ariba online buyer and supplier network facilitates more than $319 billion in commerce transactions, collaborations, and intelligence among more than 730,000 companies annually. Ariba has approximately 2,600 employees and is headquartered in Sunnyvale, CA. It is also the second-largest cloud vendor by revenue, according to SAP. Ariba experienced 38.5 percent annual growth in 2011, bringing in $444 million in total revenue.
"The cloud has profoundly changed the way people interact," SAP Co-CEOs Bill McDermott and Jim Hagemann Snabe stated. "The impact will be even greater as enterprises connect and collaborate in new ways with their global networks of customers and partners. Cloud-based collaboration is redefining business network innovation, and we are catching this wave in the early stage of its evolution. The addition of Ariba will create the business network of the future, deliver immediate value to our customers and provide another solid engine for driving SAP's growth in the cloud."
Experton Group believes the SAP acquisition of Ariba is a brilliant move by SAP. It gives the company control of the premier buyer-supplier network, which it can tightly integrate into its supply chain applications. This will give SAP a strong chip to play when dealing with Oracle as well as alter the procurement and supply chain outsourcing landscape and processes. IT executives should understand the vision SAP is envisioning and determine how it can be incorporated into their own organizations.