SAP Plans To Buy OutlookSoft
Business software maker SAP AG announced plans Tuesday to buy OutlookSoft
Corp. and its line of technology products tailored for budgeting and financial
forecasts, the latest development in SAP's duel with Oracle Corp.
The deal follows Oracle's recently completed $3.3
billion acquisition of Hyperion Solutions Corp., a maker of so-called "business
intelligence" software that delves into some of the same areas covered
by OutlookSoft's products.
Walldorf, Germany-based SAP isn't spending considerably less to snap up privately
held OutlookSoft. Although financial terms weren't released Tuesday, Forrester
Research analyst Paul Hammerman estimated the price at about $200 million.
Formed in 1999, Stamford, Conn.-based OutlookSoft has about 700 customers and
250 employees, most of whom are expected to join SAP after the acquisition closes
Tuesday's deal is the latest to illustrate the contrasting approaches of SAP
and Oracle as they wrestle for corporate customers, schools and government agencies
who rely on software applications that automate a wide range of administrative
Redwood Shores-based Oracle has emerged as a more formidable threat to SAP
by spending about $25 billion on 30 different acquisitions during the past 2
Meanwhile, SAP has focused on luring away customers alienated by Oracle's aggressive
expansion while also trying to supplement its product line with smaller, "tuck-in"
acquisitions of niche players like OutlookSoft.
In a sign of the increasing acrimony between the two companies, Oracle has
accused SAP of resorting to dirty tricks to steal its customers. In a federal
lawsuit filed in March, Oracle alleged an SAP subsidiary has been improperly
hacking into its computers to swipe information about copyrighted software.
SAP has denied the allegations.
Hammerman believes SAP's interest in OutlookSoft probably intensified after
Oracle bought Hyperion and another software maker, Business Objects SA, announced
its plans last month to buy Cartesis SA for $300 million. Cartesis competes
"With all the movement in this space, SAP was under the gun to fill this
gap in its lineup," Hammerman said.
SAP has been building up its line of financial planning software for the past
two years, said Doug Merritt, the company's head of business user development.
By adding OutlookSoft, "we will have the most disruptive and defining"
suite in the industry," Merritt said.
The OutlookSoft acquisition also adds another longtime Oracle foe to SAP's
team. OutlookSoft has been run for the past two years by Phil Wilmington, a
former PeopleSoft Inc. executive who participated in an unsuccessful effort
to prevent that software maker from being taken over by Oracle. SAP's Merritt
also worked at PeopleSoft before Oracle seized control.