05 February 2004 | Simon Binns
Enterprise spend management solutions provider Ariba has bought global supply management software firm FreeMarkets for $493 million.
The integrated company will keep the Ariba name and combine the leadership teams of both companies.
Bob Calderoni, Ariba's chairman and chief executive, will lead the new company, while Dave McCormack, FreeMarkets' president and chief executive, will become president and join Ariba's board of directors.
FreeMarkets' shareholders own 28 per cent of the outstanding capital stock of the combined firm.
Both organisations will continue with all committed product deliveries until the deal is completed. The companies' applications will be merged into one platform at a later stage.
Calderoni said: "This deal brings together two leading companies focused on providing customers with innovative ways to make an impact on their bottom lines. I am excited by what this means for our customers, stockholders and employees."
Neither company has yet said what it will do with the auction services of automotive e-marketplace Covisint, which FreeMarkets bought before the merger.
At the time of the deal, FreeMarkets said that taking over the marketplace's customer contracts for auction services would provide three years' worth of revenues.