IBM to Buy Cloud HR Software Vendor Kenexa for $1.3B
IBM plans to boost its enterprise social line of software by acquiring Kenexa, a maker of cloud-based human resources applications, the companies said on Monday.
IBM has agreed to pay US$46 per share for Kenexa in a cash transaction worth about $1.3 billion. Kenexa shares closed at $32.39 on Friday, so IBM is offering a premium of 42 percent for the company.
Kenexa, based in Wayne, Pennsylvania, has almost 9,000 customers, including more than half of the Fortune 500. It has about 2,800 employees and operations in 21 countries.
Kenexa makes a variety of cloud-based applications for HR functions like recruiting, compensation, performance management and employee surveys. Kenexa also offers consulting services to complement its software products.
IBM's goal in acquiring Kenexa is to strengthen its enterprise social and HR software and services. IBM plans to continue developing and supporting Kenexa products, while also bundling and integrating them with its own wares.
Kenexa is the latest company in the enterprise HR software market to be acquired recently. Oracle bought Taleo in February, while SAP snapped up SuccessFactors in December.
IBM expects the Kenexa deal to close in this year's fourth quarter, after it receives approvals from Kenexa shareholders and regulatory bodies.
In the second quarter of 2012, ended June 30, Kenexa had revenue of $86.3 million, and a net loss of $1.7 million, or a loss of $0.06 per share. That compares with $69 million in revenue, and a net loss of $1.6 million in last year's second quarter.
Juan Carlos Perez covers enterprise communication/collaboration suites, operating systems, browsers and general technology breaking news for The IDG News Service. Follow Juan on Twitter at @JuanCPerezIDG.