Thursday, November 22, 2007

FT.com / Companies / Europe - US group might bid for troubled SAP unit

FT.com / Companies / Europe - US group might bid for troubled SAP unit

US group might bid for troubled SAP unit
By Helene Laube in San Francisco

Published: November 22 2007 22:56 | Last updated: November 22 2007 22:56

Rimini Street, a US-based provider of software support, said it was interested in buying TomorrowNow, the SAP unit at the centre of a corporate spying scandal.

“We are interested, but we are proceeding cautiously and need to analyse it first,” Seth Ravin, chief executive of Rimini Street, told FT Deutschland, the FT’s sister paper in an interview.

SAP, the German software group, revealed at the beginning of the week that it was exploring options for the troubled unit, including selling it.

Mr Ravin was among the founders of the Texas-based TomorrowNow and sold the company to SAP almost three years ago.

He declined to say whether talks were going on with SAP.

The scandal surrounding TomorrowNow, which like Rimini Street sells software maintenance and support to former Oracle customers, broke when SAP’s arch-rival filed a lawsuit earlier this year accusing SAP of corporate espionage.

In the wake of the scandal, TomorrowNow’s chief executive and several senior member of management resigned on Monday.

SAP is under pressure to announce a swift solution for TomorrowNow in order to avoid further damage to its image.

The announcement was widely seen as unsettling customers relying on long-term software support.

Since SAP’s announcement, Rimini Street had received a dozen enquiries from TomorrowNow customers “exploring a possible transition”, Mr Ravin said.

Customers were uncertain since SAP had not been clear about “what they are doing with TomorrowNow,” he added.

Rimini Street is seen as one of the few potential buyers for TomorrowNow, as most big IT service provider are working in collaboration with Oracle and are said not to be interested.
Copyright The Financial Times Limited 2007

Wednesday, November 21, 2007

SAP To Put “For Sale” on TomorrowNow? | AMR Research

SAP To Put “For Sale” on TomorrowNow? | AMR Research


We’re only a couple of months away from the three-year anniversary of SAP’s purchase of TomorrowNow, a company specializing in third-party maintenance and support of Oracle’s JD Edwards, PeopleSoft, and Siebel software customers. Instead of celebrating, it looks like the couple could be heading for divorce. On November 19, SAP announced that TomorrowNow CEO Andrew Nelson and several other executives were resigning from the company. SAP also said that it was considering a sale of the independent unit. In our view, a sale is likely if only to accelerate the end of the Oracle lawsuit.

On March 22, Oracle filed a complaint in U.S. District Court in San Francisco, alleging that SAP/TomorrowNow had “stolen thousands of proprietary, copyrighted software products and other confidential materials.” Barring a settlement, the trial is headed to court in February. SAP executives would love to eliminate this distraction. It’s a safe bet that Oracle would like to see it continue indefinitely.

Safe Passage on the rocks?

In January 2005, SAP announced its plans to buy TomorrowNow for an undisclosed amount. The press release hit just hours after Oracle had held a press and customer conference to introduce Project Fusion, which I described at the time as “a futuristic product set and architecture designed as the morphing of the next generation of Oracle and PeopleSoft applications.”

TomorrowNow quickly become the centerpiece for the Safe Passage initiative to migrate PeopleSoft customers to SAP. At the time of the acquisition, SAP had 2,000 customers who were using PeopleSoft.

According to people close to the transaction, the TomorrowNow deal was initiated by SAP’s Shai Agassi despite the concern of some executive board members. It was a surprisingly aggressive piece of guerilla marketing for the very conservative ERP leader.

The most logical buyer would be Rimini Street, a TomorrowNow competitor that also focuses on maintenance and support services for JD Edwards, PeopleSoft, and Siebel customers. Rimini Street was founded in 2005 by Seth Ravin, former co-founder of TomorrowNow, who started the company after he sold his 50% stake in his old firm to SAP. For as long as I have known Mr. Ravin, he has been interested in buying TomorrowNow. He may soon get his chance.

It’s a Mad, Mad, Mad, Mad World: The Sequel

How about this for a scenario: Rimini Street succeeds in buying TomorrowNow from SAP and then later sells the whole business to Oracle. Oracle could continue the discounted maintenance program as a way of ensuring that companies remain as customers or switch them back to standard maintenance. As we have said many times before, all things are possible.

Note: We did reach out to multiple sources at Oracle, Rimini Street, and SAP. All declined to comment.

FT.com / Home UK / UK - Chief of SAP unit in US quits in spy scandal

FT.com / Home UK / UK - Chief of SAP unit in US quits in spy scandal

Chief of SAP unit in US quits in spy scandal
By Richard Waters in San Francisco

Published: November 21 2007 02:00 | Last updated: November 21 2007 02:00

The chief executive of TomorrowNow, a US unit of SAP at the centre of a corpor-ate spying scandal that has ensnared the German software group in a high-profile lawsuit, quit yesterday, the company said.

SAP also revealed it was looking at options for the troubled unit, including selling it. The newsmarks the latest step in a saga that has represented an unwelcome setback for SAP in its most important market.

The scandal broke when arch-rival Oracle filed a lawsuit this year accusing SAP of corporate espionage. It levelled the claims against TomorrowNow, a Texas-based company acquired by SAP to sell software maintenance and support to former Oracle customers. That gave it a crucial role in SAP's strategy of trying to win over Oracle customers, since the need for continuing support for older software is one of the main reasons companies hesitate to switch suppliers.

According to Oracle, TomorrowNow had used the sign-on details of several Oracle customers to access that company's computers and allegedly remove information about its products.

The German company admitted in July that TomorrowNow had made "inappropriate downloads" from Oracle's machines, although it also said the information had been kept inside the subsidiary and none had been viewed by executives in other parts of SAP.

SAP said yesterday And-rew Nelson, chief executive of TomorrowNow, and "several members of his senior management team" had "chosen to resign". It did not give details.

When the scandal first broke, SAP sent one of its own executives, Mark White, to oversee the subsidiary as executive chairman. Yesterday it said Mr White was working to "assure retention of key managers and support personnel" and safeguard customer support.
Copyright The Financial Times Limited 2007

Tuesday, November 20, 2007

FT.com / Companies / IT - SAP shakes up leadership at US unit

FT.com / Companies / IT - SAP shakes up leadership at US unit

SAP shakes up leadership at US unit
By Richard Waters in San Francisco

Published: November 20 2007 02:06 | Last updated: November 20 2007 02:06

The chief executive of TomorrowNow, a US unit of SAP at the centre of a corporate spying scandal that has ensnared the German software group in a high profile lawsuit, quit on Monday, the company said.

SAP also revealed it is looking at various options for the troubled unit, including selling it. The news late on Monday night marks the latest step in an unfolding saga that has represented an unwelcome setback for SAP in its most important market.

The scandal broke when arch-rival Oracle filed a lawsuit earlier this year accusing SAP of corporate espionage. It levelled the claims against TomorrowNow, a Texas-based company that had been acquired by SAP to sell software maintenance and support to former Oracle customers. That gave it a key role in SAP’s strategy of trying to win over Oracle customers, since the need for continuing support for older software is one of the main reasons companies are hesitant to switch between suppliers.

According to Oracle, TomorrowNow had used the sign-on details of several Oracle customers to access that company’s computers and allegedly remove information about its products.

The German company admitted in July that TomorrowNow had made “inappropriate downloads” from Oracle’s machines, though it also said that the information had been kept inside the subsidiary and that none of it had been viewed by executives in other parts of SAP.

SAP said on Monday that Andrew Nelson, chief executive of TomorrowNow, and “several members of his senior management team” had “chosen to resign”. It did not give details about the extent of the departures, or whether SAP had asked for the resignations.

When the scandal first broke, SAP sent one of its own executives, Mark White, to oversee the subsidiary as executive chairman. On Monday, it said that Mr White was working to “assure retention of key managers and support personnel” and make sure customer support was not interrupted.

The signs of upheaval at TomorrowNow appear to represent a victory for Oracle in what has turned into one of the most heated confrontations in the corporate technology market. The US and German software companies have been on a collision course over the past four years, since Oracle embarked on a series of acquisitions to challenge SAP in its core application software market. While confined to an arcane part of the corporate IT market, the bitterness of the rivalry has guaranteed it a prominent place in business press headlines, culminating in the barbs thrown over the corporate espionage suit.

“Our primary focus is TomorrowNow’s existing customers, who will be supported through this management transition,” Mr White was quoted as saying. “SAP is prepared to manage through these changes to ensure that TomorrowNow’s obligations to its current customers are met.”

Copyright The Financial Times Limited 2007

Thursday, November 08, 2007

Aberdeen Group:Acquisition-Mania Generates More Questions than Answers

Aberdeen Group:Acquisition-Mania Generates More Questions than Answers

A recent flurry of acquisitions has the top two ERP vendors locked in a battle for market share. Not satisfied with what has become the "run of the mill" acquisition of competitive ERP players and complementary applications, both SAP and Oracle have upped the ante and ventured outside the realm of the conventional acquisition. On October 7, 2007 SAP announced its planned acquisition of Business Objects, a leading supplier of Business Intelligence (BI) and Corporate Performance Management (CPM) solutions. Not to be out-done, Oracle followed five days later with its own move to acquire BEA Systems, a market leader in enterprise infrastructure software. And now, on October 17, 2007 SAP counters with yet another announcement that it will acquire YASU Technologies, a privately held provider of business rules management systems.