All quiet on the Eastern front

Contact: Ben Kolada

In contrast to the surge in deal flow that we’ve seen so far this year, IT giant IBM has been extremely muted. So far this year the Armonk, New York-based company has announced only one deal – the pickup of real estate and facilities management vendor Tririga in March for an undisclosed amount. In comparison, last year Big Blue announced 15 transactions worth more than $5bn. But that’s not to say that the company hasn’t been looking for new properties, and likely would have inked a couple of extra deals had it not been for Oracle’s meddling. In fact, Oracle’s most recent move could motivate IBM to announce a transaction of its own soon.

We’ve written in the past that IBM may have looked at Datanomic, which Oracle quietly picked up April. We considered Datanomic a nice complement to the business Big Blue got when it bought Initiate Systems in early 2010. (Initiate had an OEM arrangement with Datanomic.) More recently, though, the company was once again thwarted by Oracle in the Web content management (WCM) sector. Oracle announced yesterday that it is acquiring WCM vendor FatWire Software, and we see IBM as the potential loser here. Big Blue could use a stronger WCM component, as it is also positioning for Web experience management, and we hypothesized recently that FatWire could possibly fill this gap. However, there are a few alternatives left for IBM. For instance, the company could make a play for CoreMedia, which is the only other WCM independent with a Java-based offering that competes at the high end.

Oracle: The giant moves quietly in M&A

Contact: Brenon Daly

For a giant of a company, Oracle certainly strikes quietly when it moves to pick up some companies. Consider its latest purchase, the as-yet-unannounced acquisition of data-quality vendor Datanomic. Although Oracle hasn’t formally announced the purchase, the company does have it listed on its Web page for acquisitions. (That listing followed speculation by several market sources last week that Oracle had indeed sealed the deal.)

Oracle has already shown that it is ready to spend to buy in the data-quality market. A little more than a year ago, Oracle reached for Silver Creek Systems, an OEM partner that provided product-oriented data quality. Shortly after that transaction was announced, my colleague Krishna Roy speculated that Datanomic might be the next data-quality-related vendor to get snapped up, highlighting both Oracle and IBM as possible buyers for the UK-based company. We believe that Big Blue did look at Datanomic, which it considered a nice complement to the business it got when it bought Initiate Systems in early 2010. (Initiate had an OEM arrangement with Datanomic.)

Fittingly for a deal that wasn’t really announced, financials also weren’t revealed. Our understanding is that Datanomic had been posting strong growth recently, increasing revenue some 60% last year to about $15m. That rate, combined with the fact that there were undoubtedly other large bidders for Datanomic, make us absolutely confident that this transaction is significantly larger than Oracle’s related purchase of Silver Creek, which we estimate went off at $40m or so. In fact, we wouldn’t be surprised to hear that it was in the neighborhood of twice that amount.