Tuesday 17 / June / 2025
Frankfurt am Main (Germany): German software giant SAP says it will spend $8 billion on acquiring American "experience management" firm Qualtrics, betting on fast-paced growth ahead in a new area of data crunching.
In a statement late Sunday, the Walldorf-based group said it had secured financing of seven billion euros ($7.9 billion) to cover buying all Qualtrics' shares as well as costs related to the transaction -- the second-largest in SAP's history.
Qualtrics, which has joint headquarters in Utah and Seattle, had planned a stock market flotation in its own right this week.
The US company is an industry leader in the comparatively new field of experience management.
Invented in the 1990s, the technique calls for collecting data on customers, employees, brands and products, aiming to sharpen firms' understanding of how they are perceived.
Experience management is the "biggest growth driver for our industry and the next frontier for the global economy," SAP chief executive Bill McDermott said in a conference call.
Qualtrics has forecast revenues of more than $400 million for 2018. SAP has put its own sales at up to 25.5 billion euros.
Chief executive Ryan Smith is set to continue running the firm in its new form as a part of SAP's cloud computing division.
But it will be backed by the sales power of SAP and its existing 413,000-strong customer base to expand even further, executives say.
"We have an opportunity to take experience management to the world," Smith said.
Both SAP's and Qualtrics' boards as well as the US firm's shareholders have approved the transaction, which is slated for completion by the middle of next year.
Investors were wary of the deal as the Frankfurt stock market opened on Monday, with SAP stock shedding 4.4 per cent by 9:55am (0855 GMT) to trade at 90.00 euros, against a DAX index of blue-chip German shares down 0.75 per cent.
