SAP, a top technology company out of Germany, has announced a $2.1 billion acquisition of U.S. sales software firm Callidus Software. The purchase is a move that SAP hopes will increase revenue from its cloud platform and streamline its overall business.
Callidus Software, which trades as CallidusCloud, is a global enterprise software and SaaS company based in Dublin, California. Its primary products include cloud services centered around sales, human resources, marketing, and finance.
The agreement, secured by SAP, includes a $36-per-share deal giving shareholders a 21% premium over an average of the last 30 days. SAP plans to fund the acquisition using existing cash and an acquisition term loan.
A New Front Office Suite
One result from the acquisition will be a reimagined front office suite combining CallidusCloud’s suite of sales performance management (SPM) and configure-price-quote (CPQ) solutions with SAP’s existing assets, global reach, and complementary products and services.
SAP said, “The combination of SAP’s assets with CallidusCloud’s will deliver the most complete, end-to-end, fully cloud-based ‘Lead-to-Cash’ offering.”
“SAP is connecting the back office to the front office in this consumer-driven growth revolution,” said Bill McDermott, CEO of SAP. “Our customers are focused on reinventing sales, service, marketing, and commerce. The addition of CallidusCloud aligns perfectly with SAP’s innovation strategy to transform the front office.”
CallidusCloud and SAP Come Together
SAP said it intends to combine CallidusCloud’s asset portfolio with its own S/4 HANA business suite, Hybris, and Gigya products in order to bolster their capabilities and assist customers in enhancing sales and customer engagement.
SAP has been developing its S/4 HANA cloud platform, which currently has around 7,900 customers, to bring more customers to the cloud and away from traditional locally-installed, licensed software.
CallidusCloud’s cloud-based Lead to Money (Quote-to-Cash) suite adds to SAP’s growing library of cloud-based solutions.
Once the transaction is finalized, SAP plans to consolidate all CallidusCloud product assets within SAP Hybris solutions as part of SAP’s Cloud Business Group. SAP said that CallidusCloud’s existing management team will stay on and remain in their roles. The SAP Cloud Platform becomes a platform for technical integration of CallidusCloud solutions.
SAP has long been a leader in the back-office software space. This new acquisition enables SAP to add a popular front-office solution to its portfolio and build on its cloud-based product library.