In its largest acquisition to date, online procurement pioneer today confirmed its plans to buy Tradex Technologies Inc., a provider of software and services to Web marketplace operators, for about $1.9 billion in stock.
Ariba chairman and CEO Keith Krach said the company is intent on being a major player in marketplaces, and Tradex supplies the Web and transaction-processing technology to 18 of them. "Business-to-business E-commerce will not just be enterprise buy-side applications and supplier catalogs, but also Net markets," he says. "We and Tradex believed that our businesses were ultimately going to converge. Now we can hook these vertical marketplace onto our buying network and bring all that Fortune 500 spending to them." More than 50 large customers, including Chevron, FedEx, General Motors and Merck, are using or deploying Ariba's technology for Web-based procurement.
Pierre Samec, CIO of marketplace operator and Tradex customer Chemdex Corp. in Mountain View, Calif., applauded the deal, which is expected to close by June. "I think we'll get better technology by partnering with Ariba," he said. "They understand that procurement is just one piece of the business-to-business puzzle; you also need integration, catalog management, transaction processing, and customer service."