UPDATE 1-Tibco shares rise after report says SAP mulling bid

(Adds analyst comments, updates share movement)

BANGALORE, Aug 10 (Reuters) - Shares of Tibco Software Inc TIBX.O surged as much as 17 percent after a German weekly reported that business software maker SAP SAPG.DE is considering bidding for the U.S. firm.

On Aug. 8, the weekly, Wirtschaftwoche, cited its source as saying the two companies were in “very advanced talks” but that the outcome was not yet certain. [ID:nL8620524]

“Such a move will be logical on the part of SAP because we feel it would make sense for SAP to expand its portfolio of middleware products,” Piper Jaffray analyst Mark Murphy said.

Tibco, which has a market value of about $1.48 billion, specializes in middleware products aimed at integrating programs from various software providers.

Tibco said it does not comment on rumors or speculation. SAP declined comment.

However, analyst Murphy did not comment on whether this speculation was substantial or not.

Tibco competes with larger business software makers SAP, Oracle ORCL.O and IBM Corp IBM.N.

“Tibco has an instrumental piece of software infrastructure, it has a very entrenched installed base with a large amount of recurring revenue and, moving forward into the future, it’s a key foundation of the cloud computing movement,” Murphy added.

In June, Tibco, whose software helps computer systems communicate with each other, said it would sell products to help companies run programs on's AMZN.O cloud computing system, a move that might spur adoption of the fledgling technology. [ID:nN02131934]

These cloud services providers rent time on huge server farms to companies that want to run programs, store data or access data bases remotely, without having to invest in hardware.

Murphy also said Oracle’s aggressive acquisition spree over the last six years could be pressuring the world’s biggest maker of business management software to contemplate acquisitions.

Analysts believe Oracle has been taking customers away from SAP in the market for business management software.

“Oracle’s acquisition spree may be placing incremental pressure on SAP, and that may be forcing SAP to contemplate additional acquisitions at a faster pace than it would otherwise,” said Murphy of Piper Jaffray, which makes a market in Tibco shares.

Shares of Tibco touched their highest in more than two years at $9.87 before paring some gains to trade up $1.08 at $9.55 Monday afternoon on Nasdaq. They have surged 90 percent so far this year. (Additional reporting by Saumyadeb Chakrabarty; Editing by Maju Samuel and Deepak Kannan)