I came across an interesting article in the Globe and Mail of Canada. The title of the article: Open Text move may open door to its own takeover: Hummingbird deal could attract HP
Anyway, from their article last week:
One industry observer suggested yesterday the merger could act as a catalyst for a takeover by HP or SAP AG. Peter Misek, an analyst with Canaccord Adams, suggested in a research note that HP’s sales force are clamoring for the computer company to buy a software provider in order to compete with the likes of IBM.
“For long-suffering Open Text shareholders, we see this as an inevitable conclusion,” Mr. Misek wrote. “For HP there is only one vendor of size left — the combined firm of Open Text and Hummingbird. While some would point to the coming merger of Open Text/Hummingbird as a potential obstacle for HP, we believe HP would actually prefer to acquire both and handle the integration of the combination simultaneously.”
Very interesting indeed!
Very interesting…I don’t sense that we’ve seen the end of this yet…
John,
Thanks for your continued interest in BetterECM.
I agree that the consoldation will continue. I think there could be a backlash to the Uber-ECM offerings like IBM, EMC and HP (with Open Text) which could fuel the growth of the Open Source ECM market.
Inquiring minds what to know…
I think Oracle may have an equally strong interest in acquiring Open Text. Open Text shared the stage with Oracle at Oracle’s Content DB product announcement this summer with their own announcement of plans to adopt the Oracle content infrastructure.
I think your comments about these large consolidations for driving future grown of Open Source alternatives is very probable and would be especially attractive for small and medium enterprises (SMEs).
Yikes. I’m an employee of Opentext now (and formerly of Hummingbird) and this is a little weird. But thanks for the notice.
Hey, it could just be a rumor. Just keep your eyes open and ear to the ground.
Oracle set a new multiple with the Stellent acquisition. Open Text had Hummingbird for 1.9, IBM got FileNet for 2.6, and Oracle went to 3.5 for Stellent. Should HP shell out the ~$1.4 billion for Open Text? Seems pricey with both Vignette and Interwoven still waiting in the wings. Stellent would have been an ideal target for HP. It has a deep content/records stack but is very weak on email archiving, a gap filled by HP’s RISS. I’m not sure what Oracle will do to fill the archiving void. Symantec is way too big (think PSFT) and Oracle has no intention of playing in the consumer space. There’s OTEX… And then there’s niche. What’s Larry’s next victim: Zantaz or AXS-One?
George,
I had not thought of looking at the multiples! You make some interesting points. I am not sure if Larry is going to scoop up another content management provider or not. I did notice on Sanjay Kalra’s Blog that he speculates that SAP will be the ones to take out Open Text and not HP.
I think it it time to set up “Fantasy ECM” so we can buy and trade ECM companies and see what we come up with!
Thanks for stopping by BetterECM.
The market will consolidate. It’s just a matter of which of the BIGS will shell out the BUCKS. It is likely that OTEX is next on the list. The question is … who are the likely suitors? EMC should not be counted out. They bought DCTM, but that might not be the end of it. However, ORCL and HP and perhaps another behemoth out West are the likely suspects.
That ORCL paid so much for Stellent and the somewhat unsurprising IBM play for FILE shows there is money available to build out the core offerings. To me the interesting point is that all of these solutions will drive a lot of service revenue. Having the products in the arsenal is just that — another arrow in the quiver. Having the revenue and the long term vendor lock-in is the brass ring they are all striving for.
Jeff,
Thanks for stopping by BetterECM.
I agree with your observations. One little wrinkle that may make things interesting is the Open Source movement for ECM. Alfresco is creating more and more buzz. I see them as the alternative to the big guys that many mid size businesses will find very attractive.