Ariba to acquire Quadrem

The global business commerce solutions provider will acquire Quadrem, the privately-held provider of one of the world’s largest supply networks and on-demand supply management solutions.

With the acquisition of Quadrem, Ariba further expands the depth and breadth of the Ariba Network, its web-based trading community.

“Ariba’s on-demand commerce solutions and global trading network have made it easier for businesses of all sizes and industries to buy, sell, and manage cash. The acquisition of Quadrem will enable us to further expand our network volume and reach, accelerate growth, and extend better commerce to more companies in more regions of the globe,” said Bob Calderoni, CEO of Ariba.

“Quadrem has proven its ability to build and monetize large-scale collaborative commerce programs. We can leverage this experience to create additional value for our customers and bring our proven solutions to Quadrem’s existing customer base to enhance the value of their investments,” said Calderoni.

Quadrem’s 100% on-demand solutions service customers across a range of industries, including: natural resources, oil & gas and manufacturing. The company also operates a supplier identification and verification offering that is complementary to Ariba Discovery™, a unique web-based service that helps to instantly connect buyers and suppliers around the world.

“In uniting our knowhow, solutions and people, Quadrem and Ariba can deliver unparalleled network scale and reach that enables buyers and sellers around the world to improve supply chain performance and tap new business opportunities,” said Charles Jackson, CEO, Quadrem.

“Through the combined entities, companies will have access to a truly global partner who can help them optimize and extend buyer and supplier commerce and ultimately, the results that they deliver,” said Jackson.

With approximately 70 000 suppliers in 65 countries and large buyer customers including Alcoa,
Anglo American, BHP Billiton, Nestlé, Vale and Rio Tinto, Quadrem has a global footprint and expertise in operating one of the world’s largest on-demand supply networks.

“As a customer of both Ariba and Quadrem we look forward to the combination of the two companies and to the delivery of even more robust solutions we can leverage to support our operations, enhance our procurement effectiveness and extend collaboration with our suppliers globally,” said Scott Singer, Global Head of Procurement, Rio Tinto.

Ariba will pay a $150-million, comprised of an upfront payment of $75-million in cash and
$50-million in stock, and a holdback payment of $25-million, subject to performance conditions, payable 36 months after the close in either cash or stock. Additionally, Ariba will pay approximately $10-million to modify and terminate aspects of a commercial arrangement previously entered into by Quadrem.

The transaction, subject to customary closing conditions and regulatory approvals, has been approved by both companies’ boards of directors and is expected to close in the second quarter of Ariba’s financial year 2011, ending March 31.

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