Another Cloud Deal: SAP to Buy Ariba (ARBA) For $4.3 Billion

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					Robert DeFrancesco’s
May 22, 2012

Another Cloud Deal: SAP To Buy Ariba (ARBA) For $4.3 Billion

Read the latest issue of Tech-Stock Prospector on your Amazon Kindle or Kindle for
iPad/iPhone reading app.

See the May 2012 Table of Contents and order the issue here:


SAP (SAP, $58.69) announces the acquisition of Ariba (ARBA, $44.87), a provider of
collaborative business commerce solutions, for $45 a share in a deal worth $4.3

This is a pricey purchase: SAP is paying 9.7 times Ariba’s fiscal 2011 (Sept.) revenue
of $443.8 million and 8.1 times the fiscal 2012 consensus revenue estimate of
$532.8 million.

SAP says the deal to buy the #2 cloud vendor (by revenue) is expected to close in Q3
and add to earnings in 2013.

In terms of synergies, SAP will be able to cross-sell Ariba’s Collaboration-as-a-
Service (CaaS) offering into its installed customer base. SAP also looks to expand
Ariba’s presence in several high-growth markets, including China and Latin

The big question now: How long before Oracle (ORCL, $26.36) CEO Larry Ellison
makes another cloud deal. There is no way Ellison will allow SAP to look like it is
winning the enterprise cloud war.

We covered Ariba in the January 2012 issue of Tech-Stock Prospector when the
stock was trading around $27.70 a share. There is also a piece on Ariba in the May
2012 issue.

For updates during the trading day, follow Rob on Twitter: @TechStockRadar

The May 2012 issue of Tech-Stock Prospector is available at (subscription required), in the Amazon Kindle store (this
includes the Kindle for iPad/iPhone reading app) and on the Barnes & Noble NOOK

Here are some of the topics covered in the May 2012 issue:

*The next growth phase for Apple
*Cloud-software earnings shine
*NetSuite gains enterprise traction
*Ultimate Software partners with Yammer
*Accelerating growth at Concur Technologies
*A top growth play in networking security
*Ariba arrives again
*Competition heats up between Qlik & Tibco
*Zynga proves tough to value
*F5 Networks builds momentum in wireless
*4 positive catalysts for Intel
*Acme Packet hopes for a second-half recovery
*Fusion-IO speeds up the datacenter
*There’s value in the desktop at Citrix Systems
*Splunk knows its way around machine data
*TSP Deal Report: Constant Contact

To place an order, call TSP Customer Support at 800-392-0998 or visit

Read the latest issue of Tech-Stock Prospector on your Amazon Kindle or Kindle for
iPad/iPhone reading app.

Here’s the Kindle link:


Tech-Stock Prospector Managing Editor Rob DeFrancesco has more than 20
years of experience covering the tech sector. He is a former senior writer with
Louis Rukeyser’s Wall Street., launched in 2003, is an investment-research service
focused primarily on the networking, storage, security, wireless and software
sectors. Annual subscription: $350.

For more information or to place an order, call 800-392-0998.

Description: Ariba is the latest cloud buyout