SAP’s Big Expensive Acquisitions
By Francine • Oct 17th, 2012 • Category: Pure Content, The Big 4 And ConsultingEnterprise software industry analyst and lovable curmudgeon Dennis Howlett wrote an interesting column earlier this month over at ZDNet recently and quoted me extensively.
Did SAP pay $3.4 billion for an out of control pup?
SEC filings show that SuccessFactors had internal control problems. How might this impact SAP results going forward?
SuccessFactors is a leader in cloud-based enterprise software for human resources activities. SAP paid $3.4 billion dollars for a company with about $300 million in annual revenues and that, in ten years of existence, had never made a profit. The premium over book value paid by SAP, $2.1 billion, has been recorded as goodwill, an intangible asset.
In May SAP also paid a big premium, 20%, to acquire Ariba for $4.5 billion, a software package I worked with extensively at BearingPoint in Latin America.
That’s a lot of goodwill on the books.
SAP’s auditor is KPMG.
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Francine McKenna (@retheauditors) has more than twenty-five years of experience in consulting and professional services including tenure at two Big 4 firms, both in the US and abroad. Look for my column, 