SAP AG, the world's biggest maker of business-management software, agreed Wednesday to acquire Sybase Inc. in a transaction valued at $5.8 billion to help it fend off competition from Oracle Corp.
The all-cash deal intensifies the battle between SAP and Oracle to run more of the programs that corporations use to manage their data. Oracle, the world's leading database-maker in a market where Sybase is a small player, has been on a buying binge in an attempt to take business in other areas from SAP.
SAP says the acquisition will also give it key technology from Sybase that lets business programs run on mobile phones.
Sybase shareholders will receive $65 a share, which is 56 percent higher than the closing price of $41.57 on Tuesday, before the deal discussions became public.
SAP cochief executive officers Bill McDermott and Jim Hagemann Snabe are on the lookout for acquisitions to keep from losing customers to rival Oracle and reverse the sales declines that contributed to the February departure of their predecessor, Leo Apotheker. McDermott is based at SAP's U.S. headquarters in Newtown Square, Delaware County, where the company has a workforce of 2,000.
Sybase gives SAP software that helps financial institutions analyze information.
"The deal makes sense because SAP is betting heavily on in-memory computing and mobile applications as the future of computing, and Sybase brings to the table a capability for high-speed in-memory databases and a mobile application platform," said Paul Hamerman, vice president of enterprise applications at Forrester Research in Cambridge, Mass.
The former CEO, Apotheker, presided over the first annual drop in revenue at the company since 2003 as customers facing the economic slump refrained from purchasing new software. SAP, of Walldorf, Germany, supplies software used for payrolls and customer-relations management. Oracle in December said it was winning customers at SAP's expense.
Shares of Sybase, of Dublin, Calif., soared 35 percent to $56.14 at 4 p.m. on the New York Stock Exchange.