Software AG Buys Terracotta To Boost In-Memory, Cloud Offerings

Software AG, a provider of business process management solutions with revenues of €1.1 billion in 2010, has acquired Terracotta, which develops and markets software for application scalability, availability and performance.

Terms of the acquisition were not disclosed, but I’m told the deal value amounted to “upper-middle double digits” (in millions of euros). Terracotta has raised over $23 million in funding from investors like Accel Partners, DAG Ventures, Benchmark Capital and Goldman Sachs.

Terracotta makes its software available as both open source projects and commercial products for business-critical apps in production environments. The company’s flagship product, Enterprise Ehcache, extends the capabilities of Ehcache, a popular Java-based cache with (self-reportedly) hundreds of thousands of production deployments in enterprises worldwide.

Founded in 2003, Terracotta is a privately held company with 55 employees in development centers in San Francisco and New Delhi.

Software AG says Terracotta’s solutions will form the foundation of its in-memory and cloud offerings, increase revenue with existing customers and expand opportunities with new enterprise customers. In addition, the company points out, it gains Terracotta’s large open source community.

From the press release:

The ability to scale the processing of massive loads of data across flexible, modular, geographically distributed architectures will also drive cloud adoption and transform Software AG into a full Platform-as-a-Service (PaaS) provider in the mid-term.

Terracotta’s technology can store up to a terabyte of data in-memory. This will provide customers with an unprecedented boost to application and system performance and scalability.

Software AG expects to release the first combined products in Q4 2011, while its cloud-based PaaS roll-out will start in 2012.

For more perspective on the deal, check out this blog post from Ari Zilka, Terracotta founder and CTO.