SAP has patched vulnerabilities in the latest version of its HANA software that had a potentially high risk of giving hackers control over databases and business applications used to run big multinational firms.
While hacks on phones, websites and computers grab more headlines, vulnerabilities in big business software are more lucrative to attackers as they are the lifeblood of businesses.
Sources tell dealReporter P-E firm Vista Equity is close to an agreement to buy Marketo (MKTO +6.7%), and that a deal could be announced in the "next couple " of weeks.
The site adds Marketo's lack of profits limited buyout interest, and that Vista will have to show it can deliver major cost cuts to secure debt financing for the deal.
Marketo surged earlier this month on reports the company is exploring a sale. There had been speculation Microsoft (NASDAQ:MSFT) and/or SAP - each of which could use Marketo's cloud marketing automation software to fill out their cloud CRM software lines and better compete against Oracle/Salesforce - would bid for the company.
Shares are up 43% since the reports arrived on May 10. If Vista buys Marketo, Microsoft/SAP buyout speculation could turn towards rival HubSpot (HUBS +0.8%).
Castlight Health (NYSE:CSLT) is up 23.1% premarket as it announces a strategic deal with SAP to take a key role in the SAP Connected Health platform.
The deal means a distribution partnership to add Castlight's health benefits platform to SAP's SuccessFactors Human Capital Management suite, and SAP has bought 4.76M shares of new Class B Castlight stock at $3.77/share (about $18M in cash).
Along with that purchase, SAP gets a warrant to buy another 1.9M shares of Class B stock at $4.91/share.
Castlight closed yesterday at $3.20, and is quoting at $3.94 premarket today.
The two expect to work with customer pilots in the team-up later this year.
As part of its latest move to make nice with a rival, Microsoft (MSFT -2.1%) is partnering with enterprise software giant SAP (SAP -0.8%) to support the use of SAP's popular Hana in-memory database - it's often used for performance-intensive analytics and transaction-processing work, and competes with the in-memory features of Microsoft's SQL Server database - on Azure's cloud infrastructure.
A single Hana instance on Azure will support up to 3TB of RAM, with 32TB supported over 16 instances. SAP already supports Hana on Amazon Web Services, as well as through its own cloud platform.
Also: The companies have partnered to integrate several SAP product lines - its Ariba procurement/B2B software, Concur travel/expense management software, SuccessFactors HR software, and Fieldglass labor-management software - with Office 365. And Microsoft's Intune mobile device management (MDM) software will be able to manage apps from third-party developers that rely on SAP's Hana Cloud Platform (lets developers build cloud apps running on top of Hana).
Separately, SAP has updated Hana to include graph data processing and capture & replay support. The former helps companies better understand and visualize patterns involving people, places, and things, and the latter helps IT workers evaluate and assess the impact of changes made to Hana workloads.
The Microsoft alliance follows a partnership with Apple through which SAP will (among other things) help enable third-party iOS apps that can leverage the Hana Cloud Platform. SAP is hosting its annual Sapphire Now conference this week.
Reacting to news of a possible sale of Marketo (NASDAQ:MKTO) -- which just closed up 24.7% after spiking 15% on earlier chatter -- Credit Suisse believes SAP is the most likely acquirer.
Several vendors are still missing critical CRM components, the firm says, and Microsoft (NASDAQ:MSFT) is a potential bidder as well.
Acquisitions in the cloud sector have tended to focus on the multiples of enterprise value to the last-12-months subscription revenues, it says.
Modeling several acquisitions over the past year and applying that multiple to Marketo ($198.9M in last-12-months sub revenue, and revenue growth of 38.1%) brings a share price of $44.35 -- 65.7% upside from the just-inflated closing price. Applying a standard error to the multiple brings a warranted price range of $37.03-$51.67 (38% to 93% upside).
Growth stocks have outperformed value stocks each year since 2007, but value investors are often rewarded after such periods. C.T. Fitzpatrick, the CIO of Vulcan Value Partners and the manager of Vulcan Value Partners Fund (MUTF:VVPLX), who has beaten the S&P 500 and its peers every year for the past five years gave his 4 value picks in an interview with Barron's.
Oracle (NYSE:ORCL) is his top pick. Oracle and SAP (NYSE:SAP), both are leaders in the big enterprise market, but Oracle is in a better position with its applications plus database products along with being ahead in converting its customers to the cloud.
National Oilwell Varco (NYSE:NOV) is a value pick since it generated tremendous free cash flow despite a poor quarter.
Anthem (NYSE:ANTM) is a new addition since its business model is well-suited for the Affordable Care Act. Fitzpatrick believes that the company's stock price doesn't reflect the fundamentals.
United Technologies (NYSE:UTX) gets interest as it has generated high free cash flow despite its bottom line being hurt by the strong dollar. Their accretion of cash is helping return on capital thereby making it a value pick.
His top 10 holdings as of Dec. 31 are Oracle, Parker Hannifin (NYSE:PH), National Oilwell Varco, Franklin Resources (NYSE:BEN), Discovery Communication (NASDAQ:DISCK), Swiss RE AG, MasterCard (NYSE:MA), Cisco Systems (NASDAQ:CSCO), Anthem and Boeing (NYSE:BA).
Having partnered with IBM in 2014 and Cisco in 2015, Apple (AAPL -1.3%) is now partnering with German enterprise software giant SAP (SAP -0.5%) to enable iOS apps that can leverage SAP's popular Hana in-memory database (used to power high-speed analytics and transaction-processing apps).
The companies plan to create an SDK that lets developers build iOS apps that can leverage the Hana Cloud Platform (provides cloud access to Hana database services) and also access "core data and business processes" on S/4HANA, Hana-powered versions of SAP's core enterprise apps.
In addition, SAP will "develop native iOS apps for critical business operations," and create an app design language that combines SAP's Fiori user experience with "a consumer-grade iOS experience."
Owing to both favorable demographics (enterprise device users tend to be wealthier) and solid developer support, the enterprise has been fertile ground for iOS. On the FQ2 call, CFO Luca Maestri stated a recent 451 Research survey of U.S. corporate buyers planning to purchase smartphones in calendar Q2 found 78% planning to buy iPhones.