SAP, Serious About the Cloud, Buys Concur for $8.3 Billion

Concur, founded in 1993, currently serves more than 23,000 enterprise customers and 25 million active users in 150 countries.

SAP Concur

SAP's U.S. subsidiary, SAP America, picked up one of the most well-known and utilized enterprise cloud services Sept. 18 when it announced the acquisition of Concur, a Bellevue, Wash.-based travel and expense management cloud service.

The company did not come inexpensively for SAP. The purchase price of $8.3 billion ($129 per share) represented a 20 percent increase over Concur's Sept. 17 closing stock price.

Concur, founded in 1993, currently serves more than 23,000 enterprise customers and 25 million active users in some 150 countries. The company, which has 4,200 employees and has expected revenue of $700 million for 2014, is the market leader in the multi-billion dollar market for travel and expense management software.

With the addition of Concur, SAP said its growing cloud business network will enable the transaction of more than $600 billion annually, enable commerce in more than 25 industries and have a major impact on the annual global corporate travel spend of $1.2 trillion worldwide. Together the two companies will have more than 50 million users in the cloud and will be the second-largest cloud-services company in revenue behind Amazon.

The $8.3 billion acquisition is a clear statement to competitors such as Oracle, Salesforce, Amazon, IBM, Hewlett-Packard and Dell that SAP is quite serious about owning a substantial piece of the enterprise public cloud.

"The acquisition of Concur is consistent with our relentless focus on the business network," Bill McDermott, CEO of SAP, said in a statement to the press. "We are making a bold move to innovate the future of business within and between companies."

Concur cloud services are network-based and enable travelers to use them on any desktop or mobile computer. Concur's open platform connects all the major corporate travel ecosystems, including airlines, hotels and car rental companies and enables users to create their own itineraries within their employers' boundaries.

"With Concur, people are given the professional courtesy and ultimate flexibility to make the choices that are right for them," McDermott said. "No longer does cost control for companies have to come at the expense of people."

In June 2012, Concur was awarded a 15-year contract to supply T&E software to multiple federal agencies. SAP, with government customers numbering in the tens-of-thousands, intends to expand this relationship across the globe with other governments and agencies.

Chris Preimesberger

Chris J. Preimesberger

Chris J. Preimesberger is Editor-in-Chief of eWEEK and responsible for all the publication's coverage. In his 13 years and more than 4,000 articles at eWEEK, he has distinguished himself in reporting...