Business performance software vendor Cognos is to buy performance analysis specialist Applix and is set to integrate the companies' products by early next year.

With TM1, Applix's 64-bit in-memory analytical engine, Cognos said it hopes to boost its software's ability to analyse and optimise complex financial performance data.

It will only take a modest effort to integrate the two products, said Cognos CEO Rob Ashe. He expects to have an integrated version on sale in the first quarter of next year.

One of the attractions of the Applix acquisition was the company's focus, Ashe said. "We like everything Applix does: they live and breathe performance management."

Both companies compete with Hyperion, now owned by Oracle with Business Objects, and in some areas with SAP, which acquired OutlookSoftin May.

Cognos has around 3,500 customers for its financial performance management software - and almost 20,000 more for its other products, while Applix has around 3,000 customers. Between 25- and 30-percent of those are joint customers, Ashe said. Many of them are already asking Cognos to support the TM1 engine, he said.

In 2006, Cognos was the second largest vendor of corporate performance management software, ahead of Oracle and behind Hyperion, according to market estimates published last month by analysts at Gartner Inc.

Those rankings have changed with recent acquisitions, with Business Objects now claiming third place thanks to its purchase of Cartesis and ALG Software, while Oracle-Hyperion moves to the top.