E-commerce enabler Ariba Inc. late Monday announced an acquisition it promises will make it easier for buyers and suppliers of various types of materials to find trading partners.
Aribais purchasing SupplierMarket.com, whose technology allows businesses to negotiate purchases over the Internet, in a stock deal valued at $581 million.
Ariba will exchange 6.3 million shares of stock in the deal, which is expected to close by the end of the third quarter.
SuplierMarket.com employs 155, has more than 7,700 registered buyers and more than 12,000 registered suppliers. Ariba said the deal will broaden the reach of its B2B Commerce Platform, creating new savings opportunities for suppliers, buyers and operators of online marketplaces. Ariba said the deal will also give it new revenue streams and better reach in the materials markets.
Keith Krach, Ariba’s chairman and chief executive officer, said the new sourcing technology will help increase the cash flow in the B2B space and be beneficial for the company’s partners and customers.
“This acquisition not only deepens the reach of the Ariba B2B Commerce Platform to new customers in new markets, but it also extends our value proposition to and business opportunities with our existing base of marketplaces, corporate exchanges, buyers, suppliers, commerce service providers and partners of all sizes. And we gain the additional leadership and entrepreneurial zeal of some of the industry’s foremost experts in sourcing.”
Ariba said by building in sourcing abilities, its B2B Commerce Platform stands to increase its customers’ competitive ability by allowing them to more quickly meet changing market needs. With the acquisition, the platform will have about 32,000 suppliers.
Suppliermarket was founded in February 1999 and in March announced plans to sell 10 million common shares in an initial public offering at $9-$11 a share. The company reported a loss of $6.1 million from its founding through the end of 1999 on sales of $51.5 million, according to regulatory filings.