Sybase will be run as a wholly owned subsidiary within SAP, "allowing the brand to flourish," he said. But SAP won't tie its applications to the Sybase database and push it as a preferred combination for customers. SAP's applications will continue to work equally well with databases from other vendors, Hagemann Snabe said.

That's probably a wise choice. Sybase's database, Adaptive Server Enterprise, is not a popular choice for SAP customers today, and the product had just 3.1 percent of the worldwide database market last year, according to Gartner.

In fact, ASE isn't even certified to run all of SAP's applications. That's likely to change now, and SAP said it plans to enhance ASE with its own in-memory technology, which it developed to boost the performance of its business intelligence applications.

Sybase CEO John Chen will apparently join SAP to run the database division, and SAP plans to give him a seat on its board. Despite its small market share, ASE is popular with financial institutions and stock exchanges, Chen said, and the company has grown its revenue 9 percent on average for the past five years.

Yankee Group sees the deal as a vital one for SAP.