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Software AG Buys Part of Jacada, But Why?

Posted by Andy Dornan on December 21, 2007

Software AG has announced that it is buying part of call center vendor Jacada for $26m. The deal marks SAG's third acquisition this year, indicating that the company has at least partially finished digesting webMethods, which it acquired in June for $546 million.

The unit of Jacada that SAG has acquired deals with application modernization, another name for what most SOA vendors call service-enablement: providing new interfaces to old apps. These often take the form of Web services APIs aimed at integration with other apps through SOA, but not always. The rise of rich Internet apps means that it can mean giving older mainframes or legacy servers a Web-based interface, something that doesn't require all the middleware of SOA. Indeed, the Jacada unit will be folded into the SAG's Enterprise Transaction Systems group, which is essentially it's non-SOA business unit. Its SOA products now live in the webMethods group.

The need to integrate Web 2.0 with existing enterprise IT makes this a good business to be in. But it's also one that Software AG has been in for a while. It has a long heritage in mainframe application integration, and webMethods also had a strong portfolio of technologies for giving older apps a Web services interface. So as with SAG's buying webMethods, this looks like an acquisition motivated at least in part by Jacada's 200 enterprise customers rather than its technology.

According to Software AG, this is only partly true. The unit is also very profitable in its own right, generating $12 million in revenue from just eight employees, all of whom are joining Software AG.

RELATED LINKS Rollout: Software AG WebMethods Suite Has Software AG Finished Digesting webMethods? Layer 7 and Cognos both look like good fits for Software AG. Perhaps it should have bought them instead of webMethods.