Cloud computing

Enterprise-applications software giant SAP has agreed to buy Ariba for $4.3 billion in the German company’s second multi-billion purchase in the cloud computing arena, furthering its efforts to take on Oracle.

SAP will pay $45 a share or 20 per cent more than Ariba’s May 21st closing price.

The transaction, subject to approval by Ariba shareholders and regulators, is expected to be completed by the end of August, SAP chief financial officer Werner Brandt said on a conference call.

Ariba is the leader in cloud- based collaborative commerce applications, counting BHP Billiton and Deutsche Bank among customers it connects to more than 730,000 suppliers.

As competition in on- demand software intensifies, SAP has increased its pace of acquisitions, last buying SuccessFactors in December.

With businesses increasingly choosing to store and process data on the web, SAP is shifting many of its staple applications to the internet.

“We don’t have the DNA in the cloud,” SAP co-chief executive officer Bill McDermott said in an interview. “We’re probably the most strategic cloud player in the enterprise software industry.” – (Bloomberg)