May 23 - Europe's biggest software maker SAP has announced plans to buy commerce networking company Ariba for $4.3 billion in the latest move to take on industry leader Oracle. Joanne Nicholson reports.
German business software firm SAP has stepped up its battle with Silicone Valley giant, Oracle. In a 4.3 billion dollar deal SAP will buy U.S software maker Ariba. CEO Jim Hagemann Snabe says the move will help SAP sew up the fast growing cloud computing market. SOUNDBITE (English) JIM HAGEMANN SNABE, SAP CEO, SAYING: "You have seen SAP invest heavily in the cloud the last seven years. Last year we did an intent to acquire success factors which is now part of our company which means we have the largest number of users in the cloud. Ariba is the second largest cloud business in terms of revenue, so the combined force of SAP success factors and Ariba makes SAP one of the most powerful cloud offerings out there and we really don't see much of Oracle in that space." Oracle is due to announce its latest cloud software at the beginning of June. And some analysts say that since many of Ariba's customers use Oracle's services, SAP should expect Oracle to make a rival bid for Ariba. It wouldn't be the first time. Oracle and SAP got into a bidding war over the retail software maker, Retek in 2005. Oracle won. SAP expects the Ariba deal to close in the third quarter. Joanne Nicholson, Reuters