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Tibco reached an agreement to acquire IBI, formerly Information Builders, in a move that will strengthen the data management capabilities of Tibco's analytics platform and marks the merging of two longstanding business intelligence vendors.
Financial details of the acquisition were not disclosed, and the deal -- made public Oct. 22 -- remains subject to regulatory approval. It is set to close in the first quarter of 2021.
The vendors offer complementary capabilities and IBI's technology will extend the breadth of Tibco's platform once the acquisition closes, Tibco CEO Dan Streetman said in a release.
Tibco, founded in 1997 and based in Palo Alto, Calif., has a history of significant acquisitions, 30 in all with the addition of IBI. The company, with some 4,000 employees and a market valuation of more than $1 billion, is owned by private equity firm Vista Equity Partners, which took Tibco private in 2014.
Information Builders, which was rebranded IBI last spring in conjunction with updates designed to modernize its capabilities, was founded in 1975 and also is privately held, and until Thursday was one of the oldest independent analytics software vendors. Investment banking firm Goldman Sachs took a significant stake in the vendor in 2017.
Tibco's acquisition of IBI came on the same day that Qlik, another established analytics and BI player, acquired integration and automation platform vendor Blendr.io.
Consolidating strengths, trimming redundancy
It made sense for the similar organizations to combine to more efficiently tap their technology strengths in a fast-consolidating market marked by the commoditization of basic analytics and BI functions, said Donald Farmer, founder of TreeHive Strategy. In particular, IBI brings a wealth of data connectors Tibco could use to tap into the cloud.
But the acquisition -- a classic private equity deal -- could result in staff cuts as Tibco looks to marry complementary capabilities and eliminate overlap, Farmer said.
"These companies have been at it for a very long time and they have really good customer bases, and great customer satisfaction, but they're not setting the world on fire and they're not winning 'greenfield' customers," Farmer said, referring to pulling in new customers as opposed to maintaining relationships with longtime customers.
Donald FarmerFounder, TreeHive Strategy
"This also enables a cloud play, which wasn't there, and also enables a rationalization of both of their platforms," he said. "Consolidating will be very painful for the people involved, but what will come out of this is a single company that is much more efficient than both of these companies separately."
Tibco did not respond for requests for comment.
Tibco grew, IBI matured
Tibco has grown dramatically over the years, in large part by pursuing a strategy of consistent acquisitions. In 2007 -- the same year IBM acquired Cognos and SAP acquired Business Objects -- Tibco acquired Spotfire, which it subsequently turned into its main analytics platform. More recently, in 2017, Tibco bought Cisco's data virtualization business.
Based in New York City, IBI underwent a leadership change in January 2019 when Frank Vella took over as CEO, replacing founder Gerry Cohen. Under Vella's guidance, IBI overhauled its capabilities to focus on augmented intelligence and the cloud and target small and medium-sized businesses.
In particular, IBI helps organizations manage complex, often disconnected data with tools that enable them to cleanse and prepare data so it can be embedded throughout workflows.
Tibco, meanwhile, offers what it calls Hyperconverged Analytics, which includes Spotfire 11.
According to Vella, joining forces with Tibco will benefit IBI's customers, while Cohen, who still serves as IBI's chairman, said he sees a bright future for the combined entity.
"There's some logic to the combination," said Dave Menninger, an analyst with Ventana Research. "Tibco, with the Spotfire acquisition, is really about visualization more than it is traditional BI and it has not been as strong in data integration, and with IBI's … data integration capabilities there's some opportunities for synergy."