SAP AG has announced that its American business is buying Sybase Inc.

SAP, a Walldorf, Germany, software vendor, agreed Wednesday to pay $5.8 billion in cash for the outstanding shares of the Dublin, Calif., tech vendor.

Bill McDermott, SAP's co-chief executive and a member of its executive board, said in a conference call that Sybase's expertise in mobile technology and its "strength in financial services" would benefit SAP, according to a transcript. SAP will expand its market reach by being able to serve mobile devices, he said. SAP sells software to a variety of industries, including core banking applications.

Jim Hagemann Snabe, an SAP co-CEO and executive board member, said in a press release: "The combination of SAP and Sybase will give users the option of running their operations from leading mobile devices and will unleash the full power of mobility."

SAP said it is paying a 44% premium for Sybase, based on the three-month average of its stock price.

The German company is funding the deal from cash on hand and a $3.5 billion loan. The companies said they expect the purchase to close in the third quarter.