SAP buys SaaS firm SuccessFactors in $3.4bn deal

Enterprise software maker SAP has announced a $3.4bn deal to acquire online software provider SuccessFactors.

The acquisition emphasises SAP’s intention to become a big player in the emerging software-as-a-service (SaaS) market, according to the Wall Street Journal.

“Together, we will lead the industry in providing end-to-end solutions consistently to meet any deployment preference, whether on premise, in the cloud or on device,” said Jim Hagemann Snabe, co-chief executive of SAP.

The announcement comes within weeks of SAP’s Sapphire customer and partner event in Madrid, which highlighted SAAS or on-demand cloud computing services as a key part of the software maker’s innovation strategy alongside mobile, in-memory and its core ERP platform.

“Cloud computing means simplicity; enabling access to enterprise software without the complexity of installing it,” said Snabe in Madrid.

The acquisition will accelerate SAP’s momentum as a provider of cloud applications, platforms and infrastructure and establish an advanced end-to-end offering of cloud and on-premise solutions for managing all relevant business processes, SAP said in a statement.

SuccessFactors’ solutions are highly complementary to SAP’s core human capital management (HCM) offerings as well as SAP Business ByDesign for the suite cloud market and SAP’s line of business cloud offerings for large enterprises such as SAP Sales on Demand, the company said.

“The acquisition will help us address the top priority for CEOs globally – managing people and talent,” said Bill McDermott, co-CEO, SAP. 

Lars Dalgaard, founder chief executive of SuccessFactors, said: “Expanding relationships with SAP’s 176,000 customers with our speed to value, friendly user interface, on mobile devices and the web, and seamlessly delivering more SAP solutions in the cloud will be legendary, as organisations adopt the cloud to improve their business.”

The transaction is expected to close in the first quarter of 2012, subject to approval by regulatory authorities.