CWS 3.0: March 26, 2014

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Fieldglass to Be Acquired by SAP

Business software giant SAP announced today plans to acquire Fieldglass, a global spend leader among vendor management system providers.

SAP, a German company, provides HR management capability through SuccessFactors and business procurement and business collaboration via Ariba. Fieldglass will fill in the middle for contractor or contingent labor force, according to SAP spokesman Jim Dever. “This gives us an end-to-end solution. It’s total workforce management.”

SAP expects to complete the transaction, which is subject to regulatory and other closing conditions, in the second quarter. Terms were not disclosed.

Fieldglass, which had total global VMS spend under management of $27.4 billion in 2012, according to Staffing Industry Analysts, expects no change in its management team, employee base or day-to-day operations.

“Fieldglass will continue to build out its global team and operations with the added benefit of SAP’s resources and expertise,” said Arun Srinivasan, Fieldglass’ vice president of marketing and strategy. “Fieldglass will retain its identity and continue to operate independently as a SAP company in their cloud line. This deal positions Fieldglass to serve our global customers and partners better in the long-term through increased investments in product, infrastructure, and services.”

“This is an interesting and not entirely surprising development in the space, considering the level of interest today’s corporations are taking in contingent workforce management,” said Byran Peña, Staffing Industry Analysts’ vice president of contingent workforce strategies and research. “Fieldglass has always been a leader and with this acquisition will have unique access to more than 250 thousand customers globally. What remains to be seen in the long term is what this means to the marketplace if SAP later chooses to integrate Fieldglass into its HR or procurement suites of software, which have historically been priced and managed very differently. This will create a unique competitive advantage for them that is sure to disrupt the VMS and MSP markets.”

“The acquisition of Fieldglass creates a compelling advantage for SAP customers as they access, attract and manage talent via the networked economy,” said Bill McDermott and Jim Hagemann Snabe, co-CEOs and members of the SAP’s executive board. “Combining Fieldglass with SAP is a significant milestone in our strategy to help businesses simplify everything.”

Fieldglass is headquartered in Chicago and counts approximately 350 employees. Its cloud-based solution is used in more than 100 countries and 16 languages. The company’s majority investor is Madison Dearborn Partners, a Chicago-based private equity investment firm.

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