SAS Institute may well have its sights set on Microsoft.
Just a working day just after acquisition talks among SAS and Broadcom had been designed general public, TechTarget verified that individuals negotiations have ended without the organizations achieving an agreement for Broadcom to get SAS.
As an alternative, SAS, a longtime unbiased analytics seller, is hoping tech large Microsoft gets its mum or dad firm, according to R “Ray” Wang, founder, chairman and principal analyst at Constellation Analysis.
“They are striving to get Microsoft to be component of the offer and bid,” he explained.
The Wall Road Journal to start with claimed on July twelve that SAS and Broadcom had been speaking about an acquisition that would price SAS at $15 billion to $twenty billion, and then claimed on July 13 that individuals talks had damaged down.
Experienced the offer gone by way of, at $15 billion it would have approached the dimensions of Salesforce’s $15.seven billion acquisition of Tableau in 2019, and at $twenty billion would have far exceeded it and been the most significant analytics sector acquisition ever.
All those talks with Broadcom, on the other hand, had been most likely a ploy to let Microsoft know that SAS is searching for a customer, according to Wang.
“The offer was leaked to see if Microsoft would take the bait,” he explained.
Whilst Wang explained SAS is hoping Microsoft emerges as a customer, SAS co-founder and CEO James Goodnight — greatly acknowledged as Dr. Goodnight mainly because of his PhD in studies from North Carolina Condition College — instructed workforce on July 13 that the firm is not for sale, according to SAS spokesperson Shannon Heath.
“I can verify that Dr. Goodnight despatched a information to all workforce which explained, ‘We are not up for sale,’ ” she explained.
Relating to Wang’s assertion that SAS is hoping to get acquired by Microsoft, Heath extra that SAS had no comment.
“With regard to the more inquiry about Microsoft, SAS does not comment on rumors or speculation,” she explained.
Microsoft did not promptly answer to a ask for for comment.
A superior partnership
SAS, established in 1976 when it was component of North Carolina Condition, is dependent in Cary, N.C., has a deep present partnership with Microsoft.
In June 2020, SAS and Microsoft unveiled a partnership agreement below which Microsoft became the chosen cloud supplier for SAS’ analytics products, which include things like SAS 9.4 for on-premises people and Viya 4 for its cloud buyers. In addition, SAS’ analytics applications had been migrated on to Microsoft Azure, the tech giant’s cloud computing platform, and SAS and Microsoft produced a joint go-to-sector technique.
Even with the partnership agreement, on the other hand, SAS remained cloud agnostic and in May 2021 extra native assistance for both of those AWS and Google Cloud System.
Supplied the near partnership among SAS and Microsoft, which consists of important client overlap, there would be positives to a opportunity offer among the two, according to Boris Evelson, principal analyst at Forrester Analysis.
But mainly because the Microsoft and SAS have identical technological choices, there would be negatives as very well, he extra.
“Ever considering that I’ve been working carefully with SAS, heading back again to 2000-2001, they have constantly had suitors,” Evelson explained. “SAS is a primary, very well-acknowledged worldwide model, and has appreciated nearly uninterrupted profitability for numerous a long time. Each massive program firm would profit from proudly owning SAS.”
Possible rewards of a offer among SAS and Microsoft are assorted, he explained. They include the vendors’ previously powerful working partnership, the recognition of Azure with SAS buyers, and opportunity synergies among Microsoft’s Energy Applications and Energy Automate — applications that permit enterprise people to build programs without an skills in coding and knowledge science — and SAS’ analytics abilities.
Meanwhile, over and above important technological overlap, a opportunity downside could be Microsoft’s acquisition pattern of taking organizations off the sector and both integrating them into present Microsoft products or reintroducing them as a new Microsoft item.
“That strategy will obviously not operate with these types of a behemoth as SAS,” Evelson explained. “This suggests Microsoft will most most likely depart SAS functioning as an unbiased enterprise unit for at minimum a handful of several years, and above time will rationalize the portfolio, embed some products in Microsoft’s stack and retire some.”
Wang in the same way observed that the present partnership among SAS and Microsoft is important, but extra that the high quality of that the partnership could permit the organizations to defeat opportunity hurdles.
“SAS has been creating deep associations with Microsoft, from Azure to analytics to compute,” he explained. “There appears to be to be a pretty peaceful and productive partnership.”
Kjell Carlsson, principal analyst at Forrester, in the meantime, explained it can make feeling for SAS to search for a customer, but that Microsoft may well not be the just one that in fact winds up earning the order.
An acquisition would permit Goodnight, who is seventy eight several years old, to retire. Oliver Schabenberger, who used 19 several years at SAS and served as both of those chief functioning officer and chief technologies officer, had been viewed as a attainable successor but remaining to come to be chief innovation officer at SingleStore in early 2021.
“To condition the evident, SAS has a leadership succession problem,” Carlsson explained. “Now that Oliver has remaining, I imagine all people is scratching their head as to who that successor could be. Other organizations have turned to selling the enterprise in identical circumstance.”
He observed, as an example, EMC selling by itself to Dell.
The main concern, on the other hand, is what Microsoft may well get out of attaining SAS, he explained.
SAS would convey abilities that goal knowledge researchers — a persona Microsoft has not historically qualified — but a seller that specializes in augmented intelligence and device mastering may well make a improved fit for Microsoft, according to Carlsson.
“SAS is, earlier mentioned all else, a knowledge scientist-oriented firm,” he explained. “You could make the scenario that Microsoft would profit from filling this hole, but in follow Microsoft [may well] wrestle to successfully leverage a opportunity SAS acquisition as opposed to other players in the ML/AI platform … who they could get a lot more cheaply.”
An acquisition development
Need to SAS get acquired by Microsoft, Broadcom, or anybody else, it would represent the continuation of consolidation amid analytics vendors.
In April 2020, Logi Analytics was acquired by ERP seller InsightSoftware, and in Oct 2020, IBI — formerly Facts Builders — was purchased by Tibco Software. In 2019, just 4 days ahead of Salesforce acquired on June 10, 2019, Google bought Looker for $2.6 billion.
In addition, there have been a collection of smaller sized specials with analytics vendors attaining AI and ML vendors to incorporate individuals abilities to their analytics applications. ThoughtSpot, for example, has previously designed two acquisitions in 2021, and Qlik acquired Blendr.io on the exact same working day Tibco purchased IBI in 2020.