SAP Acquires SurveyMonkey Rival Qualtrics For $8 Bn

German software major SAP has acquired Qualtrics International, a cloud based software firm in the area of experience management, for $8 billion. The all cash deal was announced just days before the cloud based survey firm goes for a public listing.

The deal is expected to close in the first half of 2019, SAP said in a statement. The Boards of Directors of SAP and Qualtrics as well as Qualtrics’ shareholders have also approved the transaction.

Under the terms of the agreement, SAP will acquire all outstanding shares of Qualtrics for US $8 billion in cash. SAP has secured financing in the amount of €7 billion to cover purchase price and acquisition-related costs. The purchase price includes unvested employee incentive compensation and cash on the balance sheet at close.

Qualtrics is a global pioneer of the experience management (XM) software category that enables organizations to thrive in today’s experience economy. The company’s XM Platform collects feedback and data across the four vital areas of a business – customers, employees, product and brand – that are essential in a world where companies succeed or fail based on the experiences they deliver.

This deal is SAP’s second biggest deal, acquisition of travel experience firm Concur for $8.3 billion in 2014 was the biggest ever.

Qualtrics competes with companies like SurveyMonkey and generates major chunk of its revenue from subscriptions and customer feedback. The company had a revenue of $184.2 million in the first half of 2019, registering a growth of 41%, whereas its nearest competitor’s revenue for the same period was $121 million.

The Utah, US based survey firm was founded in 2002 by brothers Ryan Smith and Jared Smith.

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