Apptio added another another product to its lineup Friday with the acquisition of Digital Fuel, a fellow provider of tools that help companies manage their cloud computing expenditures.
According to the SEC, the deal cost Apptio $42.5 million, most of which was paid in cash. Prior to the deal, Digital Fuel was owned by Skyview Capital, a private equity firm that bought Digital Fuel from virtualization software make VMware in 2016 for an undisclosed amount.
“As I have learned more about the Digital Fuel business, I’ve found many commonalities in our approach to customer success and support,” said Sunny Gupta, CEO of Apptio, in an email to employees announcing the deal.
Both Apptio and Digital Fuel make software that allows companies to understand how much they’re spending on the sprawling array of cloud services in place at most modern companies these days, as well as on their own infrastructure. In a release, Apptio said it plans to operate Digital Fuel as its own business unit and will continue to offer and support Digital Fuel’s products.
It’s the largest acquisition in Apptio’s history, but there have only been two, and it’s the first since Apptio went public in 2016. A company representative said “many” of Digital Fuel’s employees will be joining the combined company.
Apptio is scheduled to report its fourth-quarter earnings on Monday, and Gupta is expected to share more details about the plans for Digital Fuel during a conference call following the release of the results. The company is still losing money, or at least it was at the end of the third quarter, but revenue grew strongly in 2017.