SAP to pay $400 million for TopTier
Business software maker SAP AG has agreed to acquire US portal software company,
TopTier Software Inc. for $400 million, SAP announced Friday.
The cash deal, which is expected to be finalized in the second quarter, will
make TopTier a wholly owned subsidiary of SAP, the German company said in a
TopTier reported revenue in 2000 of just $20 million, 20 times less than its
purchase price. SAP, which already has a partnership agreement with TopTier,
expects to take a one-time research and development charge of no more than $50
million related to the deal in its next quarterly report, the companies said.
"Excluding this one-time charge and the amortization of goodwill and other
intangibles acquired, SAP expects the acquisition to have minimal impact on
2001 earnings per share," SAP said.
SAP believes TopTier will be easily integrated into its mySAP Workplace product
line. Furthermore, the TopTier acquisition will provide SAP with TopTier customers,
including DaimlerChrysler AG and Hewlett-Packard Co., enabling the German company
to compete with Oracle Corp. and Siebel Systems Inc. in the enterprise portal
market, the companies said.
On Thursday, SAP reported revenue for the fiscal year 2000 of 6.27 billion
euros ($5.6 billion), an increase of 23 percent over the 1999 figure. Net profit
was up 5 percent to 634 million euros.
Of 2000 revenue, 661 million euros came from SAP's mySAP.com Internet-based
software platform, a jump of 412 percent for the year. SAP has been pinning
its growth hopes on mySAP license revenue.