Business intelligence software giant Business Objects plans to add financial planning and performance management software to its bag of applications, agreeing to acquire partner SRC Software for $100 million in cash.
SRC develops software that helps medium to large organizations integrate
systems for budgeting, payroll planning, consolidations and reporting. Such
technology can be nearly impossible to manage as one entity without the
proper software and service connections.
Financial planning and performance management packages are something
customers have been increasingly turning to in the wake of government
“Organizations are looking to the CFO for more than financial gate keeping
and compliance, they want a strategic partner that can help them optimize
business operations and plan for the future,” said Business Objects CEO
Bernard Liautaud in a statement.
Buying Portland, Ore.’s, SRC would give Business Objects the ability to help
corporations ease pressure on the CFO, something Business Objects did not
have in its portfolio to offer customers.
SG Cowen analysts cheered the deal, noting that one of the criticisms of Business Objects has been its inability to compete against Cognos and Hyperion on product breadth and strategic vision.
“SRC puts more arrows in BOBJ’s quiver,” the equities firm said in a research note. “The lack of a performance management offering has been one of our primary concerns regarding BOBJ’s ability to remain competitive and viable.
“However, the real leverage for BOBJ is to go into an account with a broad based BI product story that will allow it to move beyond selling into IT.”
The purchase makes sense for France’s Business Objects.
SRC has been a long-term technology partner, and its performance management
software is already integrated with Extreme Insight, Business Objects’ latest platform. The deal will also grant Business Objects access to SRC’s 2,400 installations around the world, covering 1,200 customers.
Business Objects expects to close the purchase in the third quarter of 2005.
The purchase marks the latest high-profile bid in the market for software
that helps corporations more effectively run.
Business Objects made a big splash two years ago when it bought
Crystal Decisions for $1.2 billion, adding the reporting software it lacked.