SAP AG (SAP), the world’s largest maker of business-management software, held talks within recent weeks to acquire Jive Software Inc. (JIVE:US), which has a market value of more than $1 billion, people familiar with the matter said.
SAP walked away from the talks with Jive, which makes social-networking applications for businesses, after a thorough review of its potential target, the people said. SAP, based in Walldorf, Germany, decided Jive’s products overlapped too much with its own and wouldn’t add enough market share, one of the people said. SAP is a customer of Jive, according to Jive’s website.
Software companies are trying to foster client loyalty by integrating collaboration tools for employees reminiscent of Facebook Inc. (FB:US)’s social networking platform. SAP last year presented its own tool, called Jam, that’s based on code garnered from its acquisition of SuccessFactors Inc. Forrester Research estimated in 2011 that the market for social enterprise software would grow about 60 percent a year and reach $6.4 billion by 2016.
SAP spokesman Daniel Reinhardt declined to comment. Amanda Pires, spokeswoman for Palo Alto-based Jive, declined to comment on “rumors.”
Jive, which provides businesses with social-networking software that helps employees communicate and collaborate on projects, reported first-quarter revenue of $33.9 million. The company posted a net loss for the quarter of $16.6 million.
Last month, SAP said that sales of its new software licenses, an indicator of future revenue, had risen 3 percent to 657 million euros ($849 million), a significant slowdown from the 9 percent growth it posted the previous quarter.
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