B2B Focus Returns: SAP Acquiring Ariba (SAP, ARBA, ORCL)
If you recall the term B2B, you are going back a decade and then some as far as internet companies. Ariba, Inc. (NASDAQ: ARBA) was one of the key business-to-business platform builders. Now SAP AG is acquiring Ariba as the…
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The companies announced that SAP America has entered into an agreement to acquire Ariba for its cloud-based business commerce network at a price of $45.00 per share. This generates and enterprise value (equity and debt) of about $4.3 billion. The Ariba board of directors has already approved the transaction unanimously and the buyout represents a 20% premium over the May 21 closing price.
Today’s acquisition will combine Ariba’s buyer-seller collaboration network with SAP’s customer base and business process expertise “to create new models for business-to-business collaboration in the cloud.”
SAP is worth almost $70 billion in market value and its $58.77 share price for ADRs compares to a 52-week range of $47.39 to $72.52. Ariba shares were up 0.8% at $37.96 before being halted and the 52-week range is $21.90 to $40.45. With Thomson Reuters having a consensus estimate of $0.99 EPS for 2012, SAP is effectively paying 45-times earnings for Ariba.
JON C. OGG
Contact [email protected] for any questions or corrections.
Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.
