EC gives go ahead for SAP acquisition of Sybase

The European Commission has given the acquisition of Sybase the green light, paving the way for the completion of the deal within three months
Written by Ben Woods, Contributor

SAP's proposed acquisition of enterprise software company Sybase has been given the green light by the European Commission, paving the way for the purchase to be completed within months.

The deal, valued at around $6bn (£4bn), was subject to review by the commission under the EU Merger Regulation as both parties operate within similar areas, providing databases, middleware and enterprise application software.

The EC's ruling on Tuesday concluded that the two companies operated in a sufficiently different area and that any overlap between the two was minor and as such the purchase could go ahead, according to SAP.

"The Commission's investigation confirmed that horizontal anti-competitive effects are unlikely to occur in any of the relevant markets, notably in the absence of significant overlaps. In addition, the merged entity will continue to face strong competition from numerous players in all relevant markets," the German software maker said in a statement on Tuesday.

The acquisition was originally proposed in May, but the move faced strong opposition from shareholders who claimed that the companies and directors involved had "breached their fiduciary duties by failing to maximise stockholder value in negotiating and approving the merger agreement". The complaints resulted in shareholders filing several class-action lawsuits against Sybase and SAP.

However, a Securities and Exchange Commission filing made on Monday indicated that SAP has reached a settlement with shareholders, meaning that with the EC Merger Regulation review successfully navigated, the deal can continue as proposed.

"SAP is pleased to receive approval from the European Commission on the proposed acquisition," a company spokesman told ZDNet UK. He added that further details would follow when the deal closes, which is expected to be in the third quarter of 2010.

The German company said in May that it expected the deal to "dramatically expand" its market by allowing it to use Sybase's mobile infrastructure technology to reach hundreds of millions of mobile users. It had previously collaborated with the California-based company on developing corporate applications for iPhones.

Timo Elliott, senior director of strategic marketing at SAP Business Objects, acknowledged the role Sybase's technology will play in SAP's future but declined to comment on how the technology will be integrated.

"Mobility in general is obviously a huge part of the SAP strategy... Sybase brings some fantastic mobile tools, but beyond that we're not going to be commenting on any directions on how we're going to integrate the tools," he told ZDNet UK.

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