Quick Overview

  • SAP announced on Friday (March 13) its plans to acquire Reltio, an AI-first master data management (MDM) provider, aiming to enable more seamless collaboration between SAP and non-SAP data in AI applications. The company did not respond to requests for comment on the terms of the deal.
  • The acquisition is expected to close in the second or third quarter of this year. SAP plans to make Reltio's data cleansing capabilities a core feature of SAP Business Data Cloud (BDC) and offer flexible business models—customers can purchase Reltio tools separately or bundle them with other SAP products. SAP stated that Reltio's product portfolio will continue to be offered as standalone products for the foreseeable future.
  • Muhammad Alam, member of the SAP SE Executive Board and head of Product and Engineering, said during a media roundtable on Friday that the acquisition will help both companies "harmonize, cleanse, and govern" SAP and non-SAP data for AI.

In-Depth Analysis

Over the past year, SAP has been working to break down data silos within its enterprise systems to drive AI adoption, while guiding traditional ERP users to migrate to its cloud offerings—a move that comes as the 2027 support deadline approaches.

The vendor launched its Business Data Cloud platform last year, designed in collaboration with Databricks, and in the fall opened BDC to Google Cloud's BigQuery data warehouse to facilitate smoother data flow.

However, the company's cloud revenue forecast earlier this year fell short of market expectations, causing its stock to drop 15% in a single day—the largest single-day decline since 2020. The acquisition of Reltio is another step in strengthening its cloud platform as it seeks to attract traditional database customers.

"When data is scattered across different business units, platforms, and domains, lacking connection and context, AI cannot reach its full potential," Alam said in the company announcement on Friday.

Christian Hestermann, senior director analyst at Gartner, noted that like SAP, most software vendors are working on deploying agentic AI. The acquisition of Reltio will help address the reality that many SAP customers heavily use non-SAP tools and make cross-platform data sharing more reliable, he added.

"Accessing data across different data silos is nice, but if the data quality within those silos—or now interconnected silos—is poor, it doesn't help," Hestermann said. "There is still a lot of work to be done on the end-user side."

Hestermann believes that, as with most ERP platforms, there will be a lag between tool deployment and customer adoption. The acquisition is not expected to close until later this year, and time will be needed afterward to integrate the tools.

"What's worth watching is not just how quickly vendors can release new technology, but also how well they can help customers adopt it," he said. "Not just adoption at the technical level, but truly deriving business value from it. That is a more difficult and less addressed problem."