Who's the Next IBM?

The more things change, the more they stay the same. The tech landscape is getting crowded with wannabe IBM (NYSE: IBM  ) clones.

Two weeks ago, fellow Fool Alex Dumortier said that Oracle (Nasdaq: ORCL  ) might place a bid on smaller database rival Sybase (NYSE: SY  ) . Well, Sybase has indeed found a buyer -- but it ain't Oracle. Instead, German software powerhouse SAP (NYSE: SAP  ) is buying Sybase in a $5.8 billion all-cash tender offer.

SAP says that it wants Sybase for its sexy mobile application knowledge first, and the traditional database assets seem more like an afterthought. The deal should add to SAP's pro forma bottom line from day one and give both companies new tie-in business opportunities with each others' customer lists. As synergistic plays go, this one makes plenty of sense. SAP does a lot of things, but it's weak in Sybase's backyard of mobile communications and can use the database help.

It's getting harder to pin pure IBM ambitions on this kind of cross-market move, because Oracle is already pretty much a carbon copy of Big Blue's cross-section strategy: software, services, and hardware, all under one roof in a tight-knit support system. Hewlett-Packard (NYSE: HPQ  ) also fits the mold today. Some analysts see HP starting a bidding war over Sybase, but I think SAP has much more motivation to walk away with a winning bid.

With Sybase under its belt, all SAP needs in order to join that exclusive IBM-alike club is a line of server hardware all its own. Part of this Sybase deal was financed by tapping a loan credit facility from a mini-consortium of European banks, so it would be a stretch to expect any hardware deals out of SAP in the near term -- but you never know where a business plan and a passion might lead. Stay tuned.

From the other side of the same equation, Cisco Systems (Nasdaq: CSCO  ) already has all the hardware it needs (and more, in my opinion). If you put Cisco and SAP together, you'd have a fully formed omni-technologist with global scale and unique synergies. I'm not saying it will happen, but that's where the trends in enterprise technology have been pointing for a couple of years now. Stranger things have certainly come to pass.

Could you imagine Cisco buying SAP in the next year or two? Discuss in the comments below.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. The Fool owns shares of and has written puts on Oracle. Try any of our Foolish newsletters today, free for 30 days. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.


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