Qualtrics, a US-based company that specializes in collecting and analyzing data for market research and customer loyalty, has been sold to software giant SAP for $8 billion. Qualtrics had been valued at around $4.5 billion and it was just about to go public.
SAP CEO Bill McDermott said that the potential synergy between SAP’s trove of operational data and Qualtrics’ strengths in customer management simply could not be ignored. The sale is expected to be completed in early 2019.
Catherine Shu wrote this report on the Qualtrics sale for TechCrunch:
McDermott compared the potential impact of combining SAP’s operational data with Qualtrics’ customer and user data to Facebook’s acquisition of Instagram. “The legacy players who carried their ‘90s technology into the 21st century just got clobbered. We have made existing participants in the market extinct,” he said. (SAP’s competitors include Oracle, Salesforce.com, Microsoft, and IBM.)
SAP, whose global headquarters is in Walldorf, Germany, said it has secured financing of €7 billion (about $7.93 billion) to cover acquisition-related costs and the purchase price, which will include unvested employee bonuses and cash on the balance sheet at close.
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According to Crunchbase, the company raised a total of $400 million in VC funding from investors including Accel, Sequoia, and Insight Ventures. It had intended to sell 20.5 million shares in its debut for $18 to $21, which could have potentially grossed up to about $495 million. This would have put its valuation between $3.9 billion to $4.5 billion, according to CrunchBase’s Alex Wilhelm.
