Is SAP preparing to take over Commerce One?

SAP AG’s move to take a bigger slice of Commerce One is fueling rumors that SAP is slowly positioning itself to buy the e-commerce software vendor.

SAP recently invested an extra $225 million in Commerce One, bringing its stake to 20%. The deal is scheduled to go through before the end of August Under the deal, SAP also gained the right to buy a limited amount of additional shares of Commerce One common stock in the future and the right to have representation on the Commerce One board.

"Since the two vendors hooked up well over a year ago, rumors have flown that SAP would eventually buy Commerce One. SAP in the past has taken the tactic of partnering with another vendor until it could build the software itself or just taking over a smaller vendor for the expertise in an area," says Randy Weston of AMR Research, an industry think tank and consulting group.

But SAP insists it is not interested in buying Commerce One and it needs Commerce One to remain independent to reinforce its new openness and partner-friendly policy. SAP also needs Commerce One to stay alive because it has no markets product without Commerce One. In fact, SAP has agreed to limit its stake to 23% and promised it would not attempt a takeover without approval by the Commerce One board.