SAP is buying startup Qualtrics for R115 billion - days before it was scheduled to IPO
- SAP has announced its intent to buy Qualtrics for $8 billion (some R115 billion).
- Qualtrics is a Utah-based startup that helps companies gather feedback and refine their products.
- Qualtrics, which was last valued at $2.5 billion (around R36 billion), was just days away from its IPO.
- That IPO could have valued the company at $5 billion (about R72 billion)or more, right out of the gate.
SAP, the German database giant, has announced an $8 billion all-cash deal to acquire Utah-based Qualtrics, a startup last privately valued at $2.5 billion.
Notably, Qualtrics was scheduled to hold its IPO this week - an offering that could have valued the company at more than $5 billion right out of the gate, according to the company's most recent filings. The deal is expected to close in the first half of 2019.
Qualtrics specialises in what it calls experience management, or XM, providing tools to help companies gather feedback and optimise their products.
After the close of the deal, Qualtrics will maintain its existing headquarters in Seattle, Washington, and Provo, Utah. Qualtrics CEO Ryan Smith will continue in his role, as well.
Qualtrics is something of an anomaly in the world of high-flying tech startups: Founded in 2002 by Smith and his father - a professor of marketing at Brigham Young University - the company didn't accept any venture funding until it had been in business for a decade. Qualtrics had raised $400 million (about R5.7 billion) in total venture capital funding from investors including Accel and Sequoia Capital.
Over the years, the younger Smith has earned a reputation for an eccentric brand of generosity. At one point, Qualtrics paid to sponsor the Utah Jazz, its local NBA team, and had them wear a patch promoting its "5 for the Fight" cancer research charity. At another point, the company loaned a customer a Tesla Model X.
This deal comes shortly after IBM announced its intent to purchase open source software provider Red Hat for $34 billion (R490 billion). Microsoft, too, just closed its $7.5 billion (some R108 billion) acquisition of code sharing service GitHub, making this a banner year for M&A action in the business-to-business tech sector.
Receive a single WhatsApp every morning with all our latest news: click here.
Also from Business Insider South Africa:
- Vodacom’s data prices fell 16.4% in six months – and the customers are streaming in
- These are SA's top YouTube channels, including kids shows and a Brakpan man with pet tigers
- These are the 16 liquor brands rich Africans like best – including a R1,649 Japanese whiskey
- This is the ‘fainting’ dance craze taking SA by storm – and no, Limpopo is not lining up extra ambulances
- SA has 'the most representative flag' in Africa – here's why
- This is officially what the new Macbooks and iPads will cost in SA
- Watch: 10 of world's most interesting cultural rituals - including jumping over babies and a Japanese penis festival