IBM has agreed to acquire Kenexa, an HR software-as-a-service provider, ending its strategy of not competing in the business applications market.
Kenexa offers hosted software to support a number of HR processes, including recruitment, employee onboarding and performance management. IBM has agreed to pay $1.3 billion for the company, whose revenue last year $283 million.
The SaaS HR market has been subject to rampant consolidation in the last year, with SAP buying SuccessFactors in December 2011 for $3.8 billion, Salesforce.com buying Rypple that same month, and Oracle buying Taleo in February 2012 for $1.9 billion.
The Kenexa acquisition puts IBM in competition with all of these companies and Workday, the HR and finance SaaS provider from the founders of PeopleSoft.
Kenexa’s offerings include functionality that analyses social media to identify candidates, and uses social media to develop a relationship with candidates and employees. IBM said the acquisition "bolsters [its] leadership in helping clients embrace social business capabilities while gaining actionable insights from the enormous streams of information generated from social networks every day.
Salesforce.com will be relaunching Rypple, soon to be rebranded as Work.com, at its Dreamforce user conference next month.
