SAP to buy Ariba for $4.3 billion – a game changer in B2B

SAP to buy Ariba for $4.3 billion – a game changer in B2B

It’s been predicted for years but now it’s happened. SAP are to buy Ariba for $4.3 billion.

Reported in the FT late yesterday, the $45 per share offer sits at 20% above Ariba’s current valuation and it confirms SAP’s aggressive ambitions in the B2B and cloud space.

According to the FT, Bill McDermott, SAP co-chief executive told an analyst conference call that Ariba was the most successful global trading network in the world.

“We are taking another bold step in our strategy to achieve leadership in the cloud,” he said. “With this acquisition, SAP will also become the clear leader in on-demand supplier relationship management or SRM.”

There’ll be much comment in the coming days on the significance of this acquisition and the FT is already making a cloud story of it but I think this has greater significance and it has less to do with cloud and more to do with SRM and P2P.

SAP’s SRM technology is already amongst the leaders and as Jason Busch has reported recently, their new user interface is highly credible amongst it’s peers. Sure, SAP gets a powerful on demand platform but it’s the supplier network that is the real prize I suspect and this move is a game changer for the e-invoicing market especially.

With the acquisition of Crossgate last year, SAP acquired great strength in the Latin American burgeoning e-invoicing market  and now, with the acquistion of Ariba including the b-process (France) and the Quadrem network covering the southern hemisphere through it’s mining interests, there isn’t a territory that SAP won’t dominate in the e-invoicing space.