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Sybase specialises in the mobile arena and SAP is stumping up $5.8bn drawing on a loan facility of €2.75bn that it has with Barclays Capital and Deutsche Bank to add to its own cash reserves to fund the deal.
The smartphone market has grown rapidly over the last couple of years and SAP co-CEO Bill McDermott outlined its ambitions to grab a large share of that emerging market.
"With this transaction, SAP will dramatically expand its addressable market by making available its market-leading solutions to hundreds of millions of mobile users," said McDermott.
"Mobile devices are becoming the preferred interaction point with business applications, whether the user is a factory supervisor, a retail manager or an entrepreneur in a developing nation," said the other co-CEO of SAP Jim Hagemann Snabe.
Under the terms of the deal Sybase would be left to run as a standalone company keeping its name with the chairman and CEO of the acquired company being added to SAP's Executive board.
John Chen, CEO of Sybase, said that the combination of the two companies would produce results that would "drive a new wave of enterprise productivity".
The deal has the backing of both sets of directors and is expected to be completed in the third quarter.