Alphabet Inc's Google said on Thursday it is acquiring cloud software company Apigee Corp in a deal valued at about $625 million (roughly Rs. 4,158 crores), the tech giant's latest effort to claim a greater share of the lucrative cloud business.
San Jose-based Apigee's software helps companies' digital services interact with apps used by customers and partners.
The service is critical for businesses transitioning to the cloud, Diane Greene, who runs Google's cloud computing division, said in an interview. "They are a leader in this application programming interface area," she said.
Cloud computing is the increasingly popular practice of using remote internet servers to store, manage and process data.
Apigee specializes in managing so-called application programming interfaces, or APIs, the channels through which digital services connect when a company logs a purchase for a customer or places an order with a supplier.
Google will pay Apigee shareholders $17.40 for each share, a 6.5 percent premium to the stock's Wednesday close.
Apigee's shares were slightly above the offer price at $17.43 on Nasdaq in afternoon trading on Thursday.
Greene, a former VMware CEO, has pushed to raise Google's profile in corporate computing since she joined last year.
During her tenure, Google has streamlined engineering efforts and appointed new leadership for its cloud efforts, improving traction with clients, Google Chief Executive Officer Sundar Pichai said during the company's latest earnings call.
Greene predicted that the Apigee acquisition would redouble Google's momentum.
"Our customer lists are extremely complimentary," she said. "There's some overlap and some areas where we are going to be able to help each other once [the deal] closes."
The Apigee deal comes a day after Google and online storage company Box Inc said they would partner to enable Box's corporate customers to integrate Google's suite of word processing, spreadsheets and other productivity tools, known as Google Docs.
Apigee, with high-profile clients in a strategically important area, will help Google close in on the competition, said analyst Patrick Moorhead of Moor Insights & Strategy.
© Thomson Reuters 2016