E-commerce company Ariba, Inc. Monday bought
business-to-business trading firm TradingDynamics, Inc. for approximately $400
million worth of stock in an effort to enhance its business-to-business services.
TradingDynamics provides services for business customers including auctions, reverse auctions, requests for quotes (RFQ) and
exchanges. With the acquisition, Ariba (ARBA)
will incorporate TradingDynamics’ services into its Ariba Network platform.
The acquisition reflects Ariba’s strategy to build a technical and business infrastructure that enables buyers, suppliers, and
other providers to reduce costs, increase revenue, and build competitive advantage on the Internet, said Keith Krach, Ariba
president and CEO.
“This acquisition is the latest step in our business strategy to drive the adoption of business-to-business e-commerce by adding
value to the Ariba network platform,” he said. “These new markets and network services will help make the global economy more
efficient by enabling
market makers to deliver frictionless commerce environments in which market forces will dynamically
match business supply and demand.”
The agreement is structured as a stock-for-stock merger, and will be accounted for as a purchase
transaction. Ariba will issue stock worth approximately $400 million, based on current trading ranges, to TradingDynamics
stockholders. The parties expect that the transaction will close within early 2000.