PPRO...
is this a VERT in the making with this alliance??? speaking of vert, getting close to announce a split???...!!!!
Wednesday December 1, 6:32 am Eastern Time
Company Press Release
B2B Trade Media Giant Advanstar and
PurchasePro.com Join Forces to Establish Leadership
Position in Vertical Trade Communities
BOSTON and LAS VEGAS--(BUSINESS WIRE)--Dec. 1, 1999--Advanstar, Inc., a leading worldwide business
information company, and PurchasePro.com, Inc. (Nasdaq:PPRO - news), a leading provider of business-to-business
e-commerce services, announced a strategic alliance to create 20 unique business-to-business vertical communities serving
Advanstar's more than three million business customers of its leading vertical markets.
Advanstar and PurchasePro.com agreed to build industry-specific, web-based communities that provide business professionals
with information and allow them to research, source, bid, buy and sell products and services that meet their specific business
needs, as well as industry news and forums, job listings, chat rooms and auctions.
Advanstar will define the industry-specific online communities in conjunction with its content-rich, industry-focused magazines,
directories, tradeshows and conferences. PurchasePro.com will utilize its web technology, provide a large, wide-ranging
horizontal database of businesses and integrate the community with its advanced e-commerce network.
''This agreement with Advanstar demonstrates the versatility and scalability of our browser-based e-commerce network to
migrate across unlimited vertical industries,'' said Charles Johnson Jr., chairman and chief executive officer of PurchasePro.com.
''The alliance will substantially enhance our rapid revenue growth by leveraging the revenue potential inherent in Advanstar's
base of more than 3 million business customers worldwide. This is a dramatic move for the long term growth of our company.''
''Advanstar's alliance with PurchasePro.com is a win-win solution for both companies. But most importantly, it's a win for our
customers,'' said Robert Krakoff, chairman and chief executive officer of Advanstar. ''Information has always been the
facilitator that brings buyers and sellers together. For decades, Advanstar has provided that information. Now, with
Advanstar's web community sites powered by PurchasePro.com's engine, we have a powerful offering to enhance this
buyer/seller contact through the Internet.''
''PurchasePro.com is the ideal partner since they have the technical infrastructure and large horizontal network of businesses to
provide a complete e-commerce marketplace solution in an efficient, competitive and cost effective manner,'' he added.
Advanstar, Inc., an investment of Hellman & Friedman Capital Partners III, L.P., is a leading business-to-business information
company with 70 interactive websites and more than 100 business publications.
It is also a leading trade show producer with events such as the world's largest apparel tradeshow, MAGIC International; the
largest telecommunications event in Latin America, Telexpo; the world's largest automated data capture event, SCAN-TECH;
and the world's leading call center exhibitions and conferences.
Under the terms of the agreement, PurchasePro.com will earn over $5 million to create the vertical trade community
marketplaces. PurchasePro.com will also receive hosting and maintenance fees of approximately $1.6 million per year and the
two companies will share all transactional and advertising revenue created by each marketplace.
In addition, Advanstar will acquire an equity position in PurchasePro.com in the form of warrants for 350,000 shares in the
company. Further details of the transaction were not disclosed.
PurchasePro.com's business strategy is to partner with industry leaders such as Advanstar to rapidly expand the number of
small to medium size businesses on its e-marketplaces.
Other important strategic marketing arrangements include its agreement with Office Depot targeted at its 5 million small to
medium sized business customers and its alliance with Primavera Systems targeted at its 225,000 small to medium size
businesses in the construction vertical.
The company believes it can achieve a rapid increase in the size of its membership through arrangements such as these with
modest penetration. The company also believes that strong membership growth should allow it to attain greater leverage to
generate multiple, recurring revenues from its membership through increased subscription and transaction fees and advertising
revenues. The company is pursuing a number of additional alliances, some of which may be completed by as early as Q4 1999.
About Advanstar, Inc.
Advanstar, Inc., based in Boston, is owned by Hellman & Friedman Capital Partners III, L.P. based in San Francisco.
Advanstar is a worldwide business information company serving specialized markets with high-quality information resources
and integrated marketing solutions.
Advanstar has more than 100 business and professional publications and directories, 113 exhibitions and conferences,
numerous web-based communities and direct marketing, database and reference products. The company has nearly 1,500
employees and currently operates from multiple offices in the United States, Canada, Latin America, Europe and Asia.
Hellman & Friedman LLC is a private equity firm founded in 1984. The firm has raised and managed more than $4.2 billion of
committed capital which it has invested in 37 companies. Limited partners in Hellman & Friedman funds include many of the
nation's leading government, corporate, and nonprofit institutions. These investments include such media, technology, and
marketing services firms as Blackbaud, Bronnercom, National Information Consortium, and YNR.
About PurchasePro.com
PurchasePro.com, Inc. is a leading provider of Internet business-to-business electronic commerce services. The company's
e-commerce solution is comprised of public and private ''e-marketplaces'' where businesses can buy and sell a wide range of
products and services in an efficient, competitive and cost-effective manner.
A key element of its strategy is to develop sales and marketing relationships. These relationships include Office Depot, Inc.,
Primavera Systems, DigitalWork, Workflow Management, Zoomtown.com, a Cincinnati Bell subsidiary, the Greater Phoenix
Chamber of Commerce and the American Association of Franchisees and Dealers. The company provides extensive support
and training programs.
For more information, call toll free at 888/830-4600 or, in Las Vegas, at 702/316-7000. You can also access
PurchasePro.com, Inc. at its Web site, www.purchasepro.com.
This press release includes forward looking statements which are subject to a number of risks and uncertainties, including the
risks and uncertainties associated with rapidly changing technologies such as the Internet, the risks of technology development
and the risks of competition. . The company's statements about the revenue it expects to generate from its alliance with
Advanstar is a forward looking statement subject to these risks and uncertainties as well as the risk the company may be
delayed in developing f the vertical communities it has agreed to develop. The company's statements about its expected rapid
revenue growth depends on factors such as its ability to continue to enter into strategic marketing alliances and rapidly increase
its membership. Similarly, the company's statements about the expected rapid growth of its membership and its ability to
increase revenues as its membership base grows are forward looking statements subject to these risks and uncertainties and its
ability to successfully achieve penetration of the customer bases of its strategic partners. Delays or difficulties in achieving
penetration may be experienced. Accordingly, actual results could differ materially. For more information about the risks and
uncertainties that could cause a actual results to differ from these forward looking statements , see the SEC filings of
PurchasePro.com, Inc, including the section entitled ''Factors That May Affect Results'' in its 10Q filing for the quarterly period
ended Sept. 30, 1999, which is available from the company on request and on the Internet at the SEC's Website,
www.sec.gov.
Contact:
PurchasePro.com, Inc., Las Vegas
Richard St. Peter, 702/316-7000 (CFO)
or
Morgen-Walke Associates, Inc.
Brooke Deterline or Lyle Ross, 415/296-7383
or
Advanstar, Inc., Boston
Robert L. Krakoff, 617/267-6500 (Chairman and CEO)
or
Hellman and Friedman LLC
C/o Ian Campell, 213/630-6550
Abernathy MacGregor Frank |
