Marketing software company Aprimo Inc. will stay in Indianapolis after being sold for $525 million to Dayton, Ohio-based based data storage giant Teradata Corp., Aprimo’s CEO said Wednesday.
“The Aprimo headquarters will remain in Indianapolis, and we will be looking to expand our applications business in both Indianapolis and globally once the deal has closed,” Bill Godfrey, president and CEO of Aprimo, said in a statement.
Godfrey, who could not be reached for comment, will lead Teradata’s applications business.
It’s not clear how many of Aprimo’s nearly 400 employees—250 of them at its East 96th Street headquarters—will lose their jobs as certain functions are consolidated with Teradata, however.
Aprimo officials deferred questions to Teradata, which could not be reached for comment.
Teradata has about 6,000 employees worldwide and had 2009 sales of $1.17 billion.
The deal announced Wednesday morning ends the independent run of Aprimo, co-founded by Godfrey 12 years ago and now posting annual sales of more than $70 million.
Just two years ago, Aprimo shelved plans for a $50 million initial public stock offering amid a deteriorating economy. Even so, the company’s annual revenue has been growing at double-digit rates.
Sales among recurring customers, such as Bank of America and Warner Brothers, grew at a torrid 29 percent last year, the company told IBJ last March.
The deal is bittersweet for Indianapolis, home to a number of burgeoning technology companies. But many are snapped up after reaching a large scale. Call center software firm Software Artistry, for example, was acquired by IBM for $200 million in 1997.
The city has but one locally based technology firm that’s publicly traded—Interactive Intelligence.
On the other hand, Aprimo appears to have fetched a rich price, with the $525 million topping the $480 million IBM paid this summer for big Aprimo competitor Unica Corp., a Waltham, Mass.-based company with 500 employees.
Many analysts in August speculated Aprimo would be the next to be acquired, with its rival now backed by deep pockets.
Venture capital firms, including local Blue Chip Venture Co., own much of Aprimo.
“We are delighted,” said Don Aquilano, managing partner of Blue Chip and of Allos Ventures. “There are very few venture-backed acquisitions of this magnitude. … This really sort of stands out as one of the larger acquisitions certainly in the Midwest, if not in the country.”
Aquilano said the $525 million purchase price is a testament to Aprimo’s management team. “They’ve grown this business through two recessions,” he said.
Teradata’s price for Aprimo reflects what the Ohio company sees as a good complement to its other big business segment: business analytics.
Aprimo’s focus is cloud-based business-to-business and business-to-consumer marketing applications. It claims to have 36 percent of the Fortune 100 companies as clients.
Publicly traded Teradata last month reported third-quarter sales of $489 million, up 15 percent from the period in 2009.
Still, some may lament the loss of independence of another local tech firm.
Aquilano said such acquisitions historically have served to stimulate development of new companies here. He points to Aprimo CEO Godfrey, who formed the company after a prior stint at Software Artistry. Others, such as Software Artistry co-founder Scott Webber, went on to help start additional companies here, the latest being BidPal, which created a mobile phone device for auctions.
Perhaps the most prolific tech executive locally is Scott A. Jones, who sold a number of companies he created, including Escient and Gracenote. Jones has gone on to create other local tech firms, including ChaCha Search and Precise Path Robotics.