SDL goes shopping again

Perhaps SDL just likes shopping in the summer. The UK-based content management and translation company, less than two weeks after acquiring XML editor Xopus, is acquiring statistical machine translation company Language Weaver Inc. (SDL also acquired XML content vendor XyEnterprise in July, 2009.)

SDL bought the company for $42.5 million in cash. The acquisition is expected to be complete by July 28. Language Weaver had an unaudited pre-tax loss of $1.0 million in 2009 and is expected to be earnings dilutive in 2011, but earnings enhancing thereafter. It will operate as an individual business unit, SDL Language Weaver, reporting into the Group CEO of SDL, Mark Lancaster, and its management team will be unchanged. For revenue purposes, it will be rolled up into the Language Technologies division of SDL.

Lancaster said in a statement that the translation market is worth $15 billion, with only up to $100 million being used on automated translation. He expects the market to grow 30 percent in the next three to five years because there are not enough human translators to meet the need for translation services. About 80 percent of the content on the web is still in English, but that will change and only 20 percent will be in English in a few years' time, he predicted in a blog post.

The company said it expected to continue to sell its existing SDL Enterprise Translation Server, based on rules-based machine translation technology, which SDL said complements the statistical approach used by Language Weaver.

Reuters quoted Analyst Tintin Stormont at Singer Capital Markets as saying the deal secured SDL's position in the market and opened up potentially significant opportunities in other sectors such as government. "This acquisition is quite strategic--as the amount of content online grows rapidly, machine translation will become an integral part of enterprises' content creation and management strategy," he told Reuters.

In addition to Language Weaver's technology, SDL acquired it for its success in the government vertical, the company said. The two companies also have several joint customers, including Adobe (NASDAQ: ADBE), Dell, Intel (NASDAQ: INTC) and Siemens.

For more:
- see the SDL press release
- see the SDL podcast, FAQs and blog posts
- see the Reuters article

Related Articles:
SDL acquires XML editor, Xopus
SDL Tridion adds Site Editor 2009
One on One with Arjan van Rooijen of SDL Tridion
SDL snags XyEnterprise