Tag: Siperian

Informatica parlays MDM bets

Brenon Daly

Contact: Brenon Daly

Informatica’s purchase of Siperian at the end of January marked the data-integration vendor’s first acquisition of a master data management (MDM) company. However, it wasn’t the first time Informatica has put money into the sector. The company held small stakes of both Purisma, which sold to Dun & Bradstreet for $48m in November 2007, and Initiate Systems, which IBM snared last week for what we heard was $425m. Both investments were tiny, with one source indicating that Informatica put less than $1m into Purisma and less than $5m into Initiate.

Though small, the investments certainly paid off for Informatica, coming at a time when most fulltime VCs are struggling to generate any returns. (Never mind the rather dismal, start-and-stop performance of nearly all other corporate venture programs.) We understand, for instance, that Informatica doubled its money on Initiate in less than a year and a half. Who knows, maybe the company just rolled over the proceeds from the sales of both MDM investments (Purisma and Initiate) into an MDM deal of its own. After all, Siperian was the largest buy that Informatica has ever made.

Informatica: an MDM deal of its own?

Brenon Daly

Contact: Brenon Daly

With one rumored pairing in the master data management (MDM) market still buzzing, word of another deal is beginning to circulate as well. Several sources have indicated that Informatica may have picked up Siperian and could announce the transaction as soon as Thursday, when it reports fourth-quarter results. (On that note, Wall Street analysts project that Informatica will report earnings of roughly $0.28 per share on sales of $139m, which would represent growth of 12% over the previous fourth quarter.) We would note that Siperian has relatively close ties to Informatica, and continues its OEM relationships with two companies the data integration giant previously acquired (Identity Systems and AddressDoctor).

The Informatica-Siperian chatter comes as IBM is thought to be close to announcing the purchase of fellow MDM vendor Initiate Systems. (Once an IPO hopeful, Initiate instead is rumored to be heading to Big Blue, with a deal expected to be announced in the next week or so.) According to our knowledge, Siperian is slightly less than half the size of Initiate, which we estimate finished last year with around $90m in revenue. We understand that Siperian, which now counts more than 50 enterprise customers, recently crossed into profitability.

While we couldn’t learn the exact price Informatica is paying for Siperian, it is likely to be a significant transaction for a company that typically inks deals totaling around $50m. (In the previous seven buys Informatica made since 2002, it paid between $28-85m.) In fact, one source indicated that the purchase of Siperian could be in the neighborhood of twice the size of its previous largest acquisition, its April 2008 pickup of Identity Systems. Informatica closed three deals last year.