This excerpt taken from the ARBA 8-K filed Sep 20, 2007.
Combination extends Aribas on-demand spend management leadership and expands presence in mid-market
SUNNYVALE, Calif., and ATLANTA, GA, September 20, 2007 Ariba, Inc. (Nasdaq: ARBA) today announced that it has signed a definitive agreement to acquire Procuri Inc. a privately-held provider of on-demand supply management solutions. With the acquisition, Ariba extends its position as the leading provider of spend management solutions to companies of all sizes and accelerates its traction in the rapidly growing mid-market.
Under the terms of the agreement, Ariba will deliver $93 million in consideration at closing, consisting of equal amounts of cash and stock, of which $14M of the cash will be placed in escrow to secure indemnity obligations of Procuri stockholders. Ariba will also pay off approximately $8 million of Procuris debt. The transaction, which is subject to customary closing conditions and regulatory approvals, is expected to close in the first quarter of Aribas fiscal year 2008, ending December 31, 2007. The definitive agreement has been approved by both companies board of directors.
Ariba has been very successful in its shift to a Software as a Service (SaaS) business model, growing year over year subscription software backlog by 60% in the past quarter. This acquisition will accelerate our growth, give us scale in our on-demand business and strengthen our position in the fast growing mid-market, said Bob Calderoni, CEO, Ariba. Procuri has proven its ability to sell on-demand solutions to growing enterprises and has built an impressive list of customers. We can leverage this customer base and experience along with our solutions to further penetrate and lead the fastest growing segment of the spend management market.
With more than 300 customers, including Barclays Bank PLC, The Boots Company PLC, ConAgra Foods, Dominos Pizza, PMC, Inc., Hess Corporation, JetBlue Airways, Novation LLC, Sun Microsystems, UPM-Kymmene, and United Parcel Service of America, Inc. (UPS), Procuri has extensive experience in delivering on-demand solutions to companies across a range of industries and geographies. Procuris strength in selling software-as-a-service and traction among growing enterprises such as AirportSmart LTD, Conn-Selmer, LeChase Construction Services LLC, Health & Hospital Corporation of Marion County, and Stonyfield Farm will enable Ariba to expand its market share and deliver on its promise to allow all companies regardless of their size to realize the benefits that spend management provides.
The combination of Procuri and Ariba creates the clear leader in the global market for on-demand spend management solutions, said Mark Morel, president and CEO,
Procuri. In uniting the industrys best-in-class technologies and people, the combined company will deliver a world-class, end-to-end spend management platform and services that enable companies to control spend, mitigate risks, and improve performance across their global supply chains.