German business software group SAP SE has announced on Monday that its unit SAP America Inc will purchase cloud-based firm Callidus Software Inc. (doing business as CallidusCloud) for a total enterprise value of $2.4 billion.
The CallidusCloud board of directors has unanimously approved the transaction, said the release. The per share purchase price of $36.00 represents a 21 percent premium over the 30-day volume weighted average price per share and a 28 percent premium over CallidusCloud’s 90-day volume weighted average price per share. The per share price represents an enterprise value of approximately $2.4 billion.
SAP has said that it has elected to fund the transaction with existing cash balances and an acquisition term loan.
The transaction is expected to close in the second quarter of 2018, subject to approval from CallidusCloud stockholders, clearances by the relevant regulatory authorities, and other customary closing conditions.
The transaction is expected to be essentially neutral to SAP’s non-IFRS earnings per share for fiscal 2018 and accretive to SAP’s non-IFRS earnings per share for fiscal 2019.
The acquisition gives SAP immediate leadership in the Lead to Money space that includes sales performance management (SPM) and configure-price-quote (CPQ). CallidusCloud offers a full suite of SPM and CPQ solutions, including sales enablement, sales analytics and customer engagement. The combination of SAP’s assets with CallidusCloud’s will deliver the most complete, end-to-end, fully cloud-based ‘Lead-to-Cash’ offering, according to the firm.
CallidusCloud has been a partner of SAP for several years, based on a joint selling agreement.
“SAP is connecting the back office to the front office in this consumer-driven growth revolution,” said Bill McDermott, CEO, SAP. “Our customers are focused on reinventing sales, service, marketing, and commerce. The addition of CallidusCloud aligns perfectly to SAP’s innovation strategy to transform the front office. SAP gives CallidusCloud the global scale to accelerate its already impressive growth. These two strong companies will be better together, help the world run better and improve people’s lives.”