Daily Management Review

Marketo To Be Acquired By Adobe For $4.75 Billion


Marketo To Be Acquired By Adobe For $4.75 Billion
Adobe Systems Inc. is set to acquire software maker Marketo Inc. in  a deal that has been reported to be worth $4.75 billion. This deal is expected to enhance the effectiveness of its marketing tools which would then enable Adobe to give a tough fight to Salesforce.com Inc. and Oracle Corp. in a market segment that is considered to be fast growing.
According to the announcement made by the companies, it is being expected that the deal would get over by the fourth quarter of the 2018 fiscal year.
The possibility of the acquisition was revealed in renews reports last week when reports of last stage negotiations between the two companies were reported by unnamed sources. There was however no confirmation given by non of the companies at that time.
This deal would be the largest ever undertaken by Adobe which is based in San Jose, California.
Adobe, best known for its image-editing tool Photoshop, has also been attempting to develop a new software suite that would include advertising, analytics and e-commerce programs. Earlier, Adobe entered the market for e-commerce through the acquisition of Magento Commerce for $1.7 billion in June. The acquisition of Marketo completes the repertoire that Adobe would need for achieving its target.
“Our ability to get a greater share of the wallet we think is enhanced with this acquisition,” Adobe Chief Executive Officer Shantanu Narayen said on a conference call.
Software that is used by companies to identify and reach new customers through email, text messages, social media and other channels is developed and sold by Marketo. The company has a special expertise in businesses marketing to other businesses and it also offers analytical services. In 2016, San Mateo, California-based Marketo was bought for $1,8 billion by Vista.
"To participate in the business-to-business marketing-automation market, Adobe needed the functionality that Marketo brings,” Lori Wizdo, an analyst at Forrester Research Inc., said.
The acquisition would give Adobe instant access to 5000 customers and the companies said that Chief Executive Officer of Marketo, Steve Lucas, will adopt a senior leadership role at Adobe.
“The acquisition of Marketo widens Adobe’s lead in customer experience across B2C and B2B and puts Adobe Experience Cloud at the heart of all marketing,” says Adobe executive vice president and general manager Brad Rencher.
Adobe would give Marketo a chance to rapidly innovate, said Lucas.
Apart from the 5000 clients that Marketo has, it also boasts of 500 partners and a marketing community of more than 65,000 members. The companies said that Lucas will continue to lead the Marketo team as part of Adobe’s Digital Experience business.
 (Source:www.martechtoday.com & www.bloombergt.com)