SAP to Acquire LeanIX to Expand Business Solutions’ Portfolio
SAP SE SAP recently announced that it is set to acquire LeanIX for undisclosed financial terms. Subject to customary closing conditions and regulatory approvals, the transaction is anticipated to conclude in the fourth quarter of 2023.
LeanIX is a privately-held company engaged in providing enterprise architecture management (EAM) software. It has been SAP’s partner for more than a decade. SAP further added that many business organizations rely on LeanIX’s solutions to accelerate digital transformation along with RISE with SAP solution. At present, LeanIX’s software-as-a-service solution aids more than 1,000 clients globally to gain clarity on their IT environment and unlock full potential of business transformation efforts.
The acquisition will help SAP in expanding its solutions’ portfolio and provide customers with end-to-end solutions needed for continuous business transformation and enabling AI-powered process optimization.
LeanIX offerings complement transformation capabilities of SAP Signavio solutions. Its solutions together with SAP Signavio Process Transformation Suite, RISE with SAP and SAP Business Technology Platform will help SAP clients to continuously adapt and improve business transformation capabilities. It will also be serving non-SAP IT landscapes, noted SAP.
SAP SE Price and Consensus
SAP SE price-consensus-chart | SAP SE Quote
Amid the rapid proliferation of generative AI trend, LeanIX recently rolled out an AI assistant. This leverages generative AI tech for EAM to boost automation as well as establish a future foundation for an “intelligent recommendation engine” for IT environment transformation, noted SAP.
The company mentioned that with its latest acquisition it will be able to embed generative AI to its solutions and help businesses to achieve financial targets like maximizing cash flow while simultaneously reducing environmental impact through self-optimizing applications and processes.
SAP is one of the largest independent software vendors in the world. The company is also the leading provider of enterprise resource planning software.
Its performance is benefiting from continued strength in its cloud business (especially the new Rise with SAP solution) across all regions. Momentum in SAP’s business technology platform particularly S/4HANA solution along with opportunities presented by proliferation of generative AI bode well.
The company’s restructuring plan is expected to align its go-to-market approach with its accelerated cloud transformation. Frequent product launches like Grow with SAP, and strategic acquisitions and collaborations are other tailwinds.
However, the company’s performance is affected by continued softness in the Software license and support business segment coupled with global macroeconomic weakness and geopolitical instability. Also, increasing research & development costs, and stiff competition in the cloud space are concerns.
SAP currently carries a Zacks Rank #3 (Hold).
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