SAP Acquires Dremio and Prior Labs to Boost Enterprise AI

SAP announced the acquisition of agentic lakehouse vendor Dremio and AI model maker Prior Labs to enhance its enterprise AI data infrastructure. The Dremio acquisition, expected to close in Q3 2026 pending regulatory approval, aims to transform the SAP Business Data Cloud into an Apache Iceberg-native enterprise lakehouse. This integration allows IT executives to unify SAP and non-SAP data without wholesale migration, specifically targeting data that remains in on-premises environments for regulated industries and manufacturing.

Parallel to the Dremio deal, SAP acquired Prior Labs, a specialist in tabular foundation models for structured data. SAP committed $1.17 billion over four years to scale Prior Labs, which will operate as an independent entity. These moves, along with a planned acquisition of Reltio, form a broader strategy to build a data foundation for agentic AI.

Company leadership stated that fragmented data, rather than model quality, is the primary bottleneck for enterprise AI deployment. Specifically, executives noted that large language models struggle with numerical accuracy and structured data in predictive analytics. By utilizing open standards like Apache Iceberg, SAP intends to eliminate data fragmentation and integration friction to support real-time AI workloads.