Saturday, December 20, 2014

Update: SAP-Ariba, one year later; Bosses quit; insider-trading punished

Software wars

Update: SAP-Ariba, one year later; Bosses quit; insider-trading punished

UPDATE: SAP CONFIRMS: “After successfully leading the transition of Ariba into SAP, Bob Calderoni has taken the decision to leave SAP," the company says in a statement. "We have benefitted greatly from Bob’s vision in building SAP’s leadership in the cloud, and we are grateful that Bob will remain as a strategic advisor to the Managing Board.. We thank him for his efforts and wish him well in his endeavors.”

EARLIER: SAP Cloud President Bob Calderoni and SAP Ariba President Kevin Costello have quit the business software giant, a little more than a year after SAP paid more than $4 billion for their cloud-computing "collaborative business solutions" company, reports Azul Partners managing director Jason Busch at his software-business Web site, SpendMatters.com.

Their departure "suggests a short earn-out period for the two Ariba executives following the turnaround of Ariba and subsequent sale to SAP," Busch and colleague Pierre Mitchell wrote. How much will they be missed? "2013 was a very strong year for the Ariba business as part of SAP" under Calderoni and Costello -- but then again, SAP is always "resuffling the deck chairs," they pointed out. Evan Welch, spokesman at SAP Americas headquarters in Newtown Square, had no comment.

Separately, the SEC has charged Campbell, Calif.-based David F. Marchand, former board assistant to former SAP Co-CEO Jim Hagemann Snabe, with "unlawful insider trading": in shares of Ariba and SuccessFactors, a cloud-based human-resources software company SAP bought, also in 2012. In a federal lawsuit filed in NJ last month (2:13-cv-07754), the SEC says Marchand "made a total of $43,500 in illicit profits through his trading."

According to the accusations, Marchand bought SAP shares in advance of a favorable 2011 year-end profit report, and bought SuccessFactors and Ariba in advance of merger announcements, using privileged information he collected while working for Hagemann Snabe before it had been made public. Marchand agreed to pay back double his profits, plus interest, "without admitting or denying the SEC's allegations." 

Marchand was busted by an investigation led by Brendan P. McGlynn, Oreste P. McClung and Daniel L. Kloster of SEC's Philadelphia office with help from the Financial Industry Regulatory Authority.

The group has been in hot pursuit (by SEC timetable standards) of insider software trading fraud: Also last month, their boss, Daniel Hawke, of SEC's Philadelphia-based markets enforcement team, charged a Microsoft executive and his pal, accusing them of pocketing nearly $400,000 trading on company info they exploited in advance of two earnings reports and a deal with Barnes & Noble. In that case the accused have also been criminally charged.

Joseph N. DiStefano
About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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