A strong denial: SAP refutes claims that Oracle pushed it toward Business Objects

SAP CEO Henning Kagermann says the decision to buy business intelligence is in line with a previously announced SAP strategy to double its customer base by 2010.

By Manufacturing Business Technology Staff October 11, 2007

SAP CEO Henning Kagermann denies the decision to buy business intelligence specialist Business Objects was a reaction to Oracle ’s acquisition spree. Instead, he says, the move goes along with a strategy SAP announced in 2005 to double its customer base by 2010.
Datamonitor News quoted Kagermann as saying, “It’s not a reaction because we can’t see that Oracle is gaining market share.”
Datamonitor also reported that interest from Hewlett-Packard and IBM in the business intelligence sector has sparked speculation about who might be the next takeover target, with Cognos and Microstrategy mentioned as the most likely candidates.
According to Datamonitor, Business Objects had long been the subject of takeover speculation. In September, French newspaper Le Figaro said Business Objects had appointed Goldman Sachs to find a suitable buyer, with SAP among five companies said to be tempted. Business Objects CEO John Schwarz disputed that account. He said Business Objects did not need to be taken over because it had been growing 50 percent faster than the market as a whole.
A day after the SAP deal was announced, however, Business Objects issued a profit warning for its upcoming quarter, an admission that had a negative impact on SAP’s stock price.
The current post-acquisition plan is for Business Objects to operate as a separate organization, with its applications tightly integrated with SAP’s platforms, as well as those of other vendors.
SAP has 41,200 customers compared with 44,000 for Business Objects. The two companies also share a large number of customers, which should open up many cross-selling opportunities.