Could SAP and HP tie the knot?

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SAP ( SAP ) and Oracle ( ORCL ) are the heaviest hitters in the modern corporate software market. Anyone flipping through the pages of the Economist or other top-shelf business magazines can see the ads that the companies level specifically at each other.


Under the cantankerous but visionary leadership of founder Larry Ellison, Oracle reached the third spot in total software sales revenue, behind IBM and Microsoft. 

SAP is still the top enterprise software company in the world, but it lost a couple of key battles with Oracle recently. Most notably, SAP was forced to cough up $1.3 billion  to its competitor after it was caught illegally downloading Oracle software. In fact, it even has to pay interest on that massive penalty.

Rumor in the industry hints that SAP might be on the auction block for an ambitious buyer, though it would have to be a well-financed one, because the German firm is still worth $62 billion.

"2011 is a crunch year for the management," Thomas Otter, a research director at Gartner, told the Financial Times . "SAP has significantly improved as a company when compared with one year ago. But what I don't know is whether this will be enough to keep the founders happy."

One of the key drivers for the rumor comes from the fact that after former chief executive officer Léo Apotheker stepped down, he headed to Hewlett-Packard ( HPQ ) and announced a renewed focus on software applications. In an unrelated event last year, HP pushed out former CEO Mark Hurd over allegations of sexual harassment and improper conduct. Larry Ellison of Oracle then promptly brought Hurd on as president of his firm's board of directors.

This could add a peculiar and dramatic twist to any potential SAP-HP tie-up. However, it's important to note that co-CEOs Jim Hagemann Snabe and Bill McDermott strenuously denied these rumors in the pages of the FT .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.




This article appears in: News Headlines , Business , Technology , US Markets

Referenced Stocks: HPQ , ORCL , SAP

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