Business software vendor SAP has reached an agreement to purchase a stake in DCW Software in a first step towards acquiring the smaller German rival.
SAP has agreed to buy a 5 per cent stake in DCW and receive the majority of voting rights in the company, Ralf Nitsch, an SAP company spokesperson, said. The German software giant, which is based in Walldorf, Germany, has also received an option to acquire all stakes in the company, he said.
The deal is subject to approval by the German Federal Cartel Office, because SAP is a key player in the same market as DCW, according to Nitsch.
The Mannheim, Germany, software vendor targets midsize enterprises with enterprise applications tailored for a range of sectors, including logistics and retailing.
"We expect to benefit from DCW's technical and midsize market expertise," Nitsch said. "The company has some highly skilled Java and C++ programmers and plenty of know-how in delivering tailored solutions to a range of sectors."
Nitsch declined to comment on whether the move to acquire DCW would help SAP acquire further market share.
Earlier this year at SAP's Sapphire customer conference and exhibition in Orlando, chief executive officer Henning Kagermann said, in the context of acquisition moves by Oracle and PeopleSoft, the German company doesn't "intend to buy market share."