SuccessFactors made a bid to buy recruiting specialist Jobs2web for $110 million in cash, an effort to bolster its own talent-management software, before SAP acquires it for $3.4 billion.
(NYSE: SFSF), which SAP (NYSE:SAP) Dec. 3 agreed to buy for $3.4 billion,
is itself swallowing a smaller fish.
paid $110 million in cash to acquire Jobs2web, a popular, cloud-based
recruiting platform that lures top candidates through social networks, such as
LinkedIn, Facebook, Bing and Twitter. Jobs2web's specialty is providing
application-tracking tools that connect hiring managers with candidates.
a popular provider of talent-management software that its hosts and delivers to
human resources managers via a Web browser, will use Jobs2web to fortify its
own professional recruiting software to "produce a transformational social
envisions Jobs2web's recruiting platform will be the "candidate
magnet," with SuccessFactors taking over from the application to hire and
easy for SuccessFactors to pull the trigger on acquiring Jobs2web, despite an
extremely competitive acquisition fight for them, because they have so many
powerful assets," Lars Dalgaard, founder and CEO of SuccessFactors, said
in a statement.
that Jobs2web is growing fast and "is disrupting the way companies can
make social networks their friends in recruiting and not a distraction, helping
hiring managers find people in ways they never could before."
acquisition close before the end of the year as expected, Jobs2web will operate
as a business unit within SuccessFactors. Customers may then choose to purchase
Jobs2web to work with SuccessFactors Recruiting Management to operate with any
other applicant-tracking system, or to operate as a standalone solution.
bid for Jobs2web comes even before the ink is dry on the Dec. 3 tender offer it
signed with SAP to be acquired by the enterprise applications powerhouse. That
deal should close in 2012.
SAP is paying $40 per share, or roughly a 52 percent premium
over SuccessFactors' Dec. 2 closing price of $26.25 and 10 times the company's
expected 2011 run rate of $300 million to $330 million.
Why pay so
much for an unprofitable company? Three C-words: cloud computing clout. SAP has
struggled to make its cloud strategy materialize in a meaningful way.
meanwhile has a lot of cache in the space, versus the likes of Taleo, Kenexa
and other Web-based human resources software makers, and should bring instant
cloud credibility to SAP, which is competing in the space against Oracle
(NASDAQ:ORCL), Salesforce.com (NYSE:CRM) and Microsoft (NASDAQ:MSFT).