For right now, this integrated scenario only runs on the “PowerPoint Platform,” but it certainly is a compelling vision. And it should eventually work in concert with the older SAP applications (e.g., service entry sheets), whether on-premise or hosted. And it should integrate to the Ariba Network. From a big “check box” standpoint, we now have Fieldglass providing a transition from SuccessFactors handling full-time and part-time workforce requirements to Ariba Services Procurement doing some basic contingent labor and SOW-based procurement and invoicing (note much of this can be done in Fieldglass as well). So, now that this vision for acquiring Fieldglass in SAP’s stated broader context of “total workforce management” is complete, the question turns to its ability to execute. This is the rough valuation that we had expected and published in SAP and Fieldglass: Questions Raised by the $1+ Billion Acquisition, albeit somewhat lower than we thought it could have gone given the size of the market, Fieldglass’s strength as the undisputed number one provider by share in the market, MDCP’s hard nosed eye for a deal, and the exuberance of the market for anything SaaS (which has died down a bit recently). Since Fieldglass itself indicated that the original buyout deal was worth over $220 million, that would put the valuation at roughly $1.1 billion. Since the actual financial terms of the deal won’t be known until SAP discloses the final terms when it files Q214 financial results, the only estimate we’ve seen for now is a Dow Jones piece that cites a net internal rate of return of 56% and that Madison Dearborn “received 5.1 times its money” according to a person with knowledge of the transaction. SAP finally closed its acquisition of services procurement provider (or VMS provider if you like) Fieldglass from Madison Dearborn Partners, according to a quietly released blog entry on the SAP website by Mike Etting, the Global Head of Cloud & On Premise HR.
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