Teradata’s Acquisition Of Aprimo Expected To Accelerate Automation Deals In 2011
- Written by Demand Gen Report Team
- Published in Feature Articles
Just as most executives were winding down for the year-end holiday break, yet another blockbuster deal hit the wires today as Teradata announced a definitive agreement to acquire Aprimo for approximately $525 million, including the assumption of approximately $25 million of cash at closing, subject to a adjustment.
Following on the heels of the recent acquisitions of Omniture and Unica, the healthy price tag Aprimo garnered has other marketing automation vendors taking notice and may further accelerate the pace of M&A activity around the space.
Analysts and other marketing automation vendors and industry experts took to the blogosphere with commentary. Jonathan Block, VP & Services Director at SiriusDecisions, said it will be interesting to see the types of vendors that choose to acquire a MAP provider and debate who’s next. “Since Teradata has been trying broaden its appeal, the Aprimo acquisition will not only help its marketing technology solution — particularly from a SaaS, lead nurturing and MRM perspective — but should also make it a more palatable choice for BtoB organizations and CMOs,” Block wrote on the company’s “Driving Sales & Marketing Alignment” blog.
Eloqua’s CEO Joe Payne hinted that Eloqua maybe a more likely candidate for an IPO than an acquisition target. “The (Aprimo) deal itself is a healthy multiple and that shows you how important this category is,” Payne said on the company’s “It’s All About Revenue” blog. Payne pointed to Eloqua’s own “exceptional” growth in 2010. “We are in a great position and have our eyes set on the public markets,” he said.
Marketo CEO Phil Fernandez pointed out that Marketo is well positioned to take advantage of the heightened interest and momentum in the space. “From top to bottom, this has historically been a very fragmented space, and it’s no surprise that we are seeing increased M&A activity,” he said on the company’s “Modern B2B” blog. As the emerging leader in the category, this trend presents a great opportunity for Marketo to be a consolidator and further extend our leadership position. We are very excited about the year ahead and beyond.”
In analyzing the Aprimo acquisition, Neolane President & CEO Stephane Dehoche pointed to “both opportunities and warnings.” On a positive note, he said, “Valuations for acquisitions in the marketing automation space continue to increase, fueling a growing, multi-billion dollar sector,” he said. “And despite working with neither mid-enterprise or BtoB customers nor on-demand delivery models, Teradata's move is a strong acknowledgment that companies need business applications to act on the vast amount of data they're storing and analyzing. Marketers need conversational platforms that leverage existing customer knowledge to ultimately drive more effective marketing strategies.”
In addition to again shining the spotlight on marketing automation, analysts pointed out that the teaming of Teradata and Aprimo will likely raise the heat on the Integrated Marketing Management (IMM) category. According to a recent report from Gartner, companies that develop an IMM strategy will deliver a 50% higher return on marketing investment than those that don’t.
Analysts also pointed out that the combined strengths of Teradata will bring powerful business analytics with integrated marketing solutions designed to enable corporations to improve and optimize marketing performance with data-driven insights. In addition, Teradata will draw upon Aprimo’s expertise in Cloud and Software as a Service (SaaS) functionality.
For the time being, Aprimo will continue to market its products and services under its own name.
“Combining these visionary companies positions Teradata as a leader in Integrated Marketing Management, Marketing Resource Management, and Multi-Channel Campaign Management, providing customers an end-to-end solution available in SaaS and on-premise environments,” said Mike Koehler, President & CEO of Teradata. Koehler said the combination will broaden the company’s addressable customer base and fuel marketing innovation for its customers.
Aprimo will be integrated into Teradata’s operations and will continue to market its products and services under the name Aprimo. Once the acquisition is complete, Aprimo will support the strategy of Teradata’s analytic and applications business, including development, marketing, sales and services going forward.
The completion of the transaction, which is subject to applicable regulatory clearances and other customary closing conditions, is expected to occur in Q1 2011. The transaction is expected to be slightly accretive to Teradata’s non-GAAP EPS in the first year following closing, according to the press release.
Aprimo CEO Bill Godfrey said the acquisition offers a combined value proposition “at a time when marketers are consolidating and integrating their marketing teams and systems while demanding more strategic analytics and intelligence,” he said in the press release. “This is great news for our present and future customers.”