30 July 2002 | Robin Parker
GE Global eXchange Services is on the acquisition trail following its spin-off from parent company General Electric.
Harvey Seegers, president and chief executive of the e-commerce company, said he was already in talks with companies for a potential buy-out later this year.
He said an acquisition would be imminent once GXS formally becomes a separate company in October.
Rather than branching out into entirely new fields of e-commerce, the company will strengthen its EDI and e-marketplace capabilities in similar areas.
"We're aware we've really not been strong enough in tackling e-payments, which are the logical place to go from EDI," Seegers said.
"They're compatible technologies, in that all the information is there already to marry remittance advice and e-transaction values."
GE sold the B2B unit to technology buy-out fund Francisco Partners for $800 million last month, citing a lack of a strategic fit.
It still retains a 10 per cent share, and the deal commits it to continue to buy $20 billion a year on the network, making up four per cent of GXS's revenues, for the next two years.
The unit was the smallest of GE's divisions, and Seegers said it had suffered from the parent company's reticence to advertise its products.
"We had more competitors that other GE units, and it was hard to be as competitive without an advertising commitment," he said. "We are now stepping all our marketing up."
Seegers also admitted GXS had been mistaken to concentrate in the past on e-procurement catalogues, and said confusion over the complexity of "punch-out" technology had made it hard to find a sufficiently broad customer base.
GXS will continue with the GE brand for the time being, but is expected to adopt a new name ahead of a planned initial public offering in 2005.