PPRO acquisition (will be interesting to see the price-effect)...
===================
Tuesday March 6, 5:07 am Eastern Time
PurchasePro to Enter the Strategic Sourcing Industry with Acquisition of BayBuilder; BayBuilder's Technology Boasts Fortune 1000 Companies Including Lennox, Owens Corning, Lexmark; PurchasePro to Acquire BayBuilder's Strategic Sourcing Automation Technology
LAS VEGAS--(BUSINESS WIRE)--March 6, 2001-- PurchasePro (Nasdaq:PPRO - news), a leading enabler of business-to-business e-commerce solutions for companies of all sizes, today announced that the company has signed a definitive agreement to acquire BayBuilder, a provider of self-service strategic sourcing technology for Fortune 1000 corporations.
PurchasePro will pay $15 million in stock and cash for the company and expects BayBuilder's financial results to be accretive to cash earnings. Completion of the acquisition is subject to customary conditions and is expected to close during the second quarter. The company continues to feel comfortable with its published guidance for the first quarter 2001 and will likely update its full year guidance once marketing plans have been implemented for BayBuilder.
``BayBuilder positions our company as a preeminent solutions provider in the strategic sourcing industry,'' said Charles E. Johnson Jr., chairman and chief executive officer of PurchasePro. ``Companies using expensive, service-based offerings from businesses like FreeMarkets are asking for alternatives. We believe that BayBuilder is the most advanced reverse auction technology, enabling our company to continue its growth in the upper market while simultaneously driving its e-commerce solutions to our mass market.''
The acquisition positions PurchasePro in the rapidly growing strategic sourcing industry, which Goldman Sachs predicts will grow from $300 million last year to $2.4 billion in 2005. With the incorporation of BayBuilder, PurchasePro will be uniquely positioned as a primary solutions provider not only for the small and medium-sized business market, but also for Fortune 1000 companies.
BayBuilder has amassed an impressive list of Fortune 1000 clients including Lennox, Lexmark, and Owens Corning in industries spanning manufacturing, high tech, public sector, chemicals, automotive and energy. The company has powered reverse auctions totaling approximately $1 billion in the last eight months alone.
``Adding BayBuilder to PurchasePro's stable of functionality is a fundamentally sound decision,'' said Vernon Keenan, chief executive officer of Keenan Vision, a nationally recognized industry analyst firm. ``What could have cost the company tens of millions of dollars to develop was acquired at a fraction of the cost, providing PurchasePro with viable software, a leading customer and supplier base, and an immediate presence in the ever-expanding strategic sourcing market. PurchasePro expects to enable companies to participate in reverse auctions at more competitive costs than other service-based providers.''
BayBuilder provides companies of all sizes with the ability to negotiate and collaborate with suppliers to lower costs and improve supplier relationships on both direct and indirect goods. BayBuilder's technology is a highly scalable application that provides virtually any industry and any size company with the opportunity to participate in stand-alone reverse auctions.
``PurchasePro's strength is bringing Fortune 1000 software solutions to the middle market,'' said Matt Yost, senior vice president of corporate development for PurchasePro. ``With the acquisition of BayBuilder, PurchasePro will provide businesses of all sizes with a complete purchasing, strategic sourcing, and forward and reverse auction tool set that is unmatched in the industry.''
BayBuilder's solution is expected to increase liquidity and drive transaction volume in PurchasePro's public and private marketplaces, further enhancing the company's recurring revenue business model. PurchasePro will provide buyers and suppliers with hosted software that enables buyers to purchase direct goods and services more effectively and enabling suppliers to sell more merchandise.
Acquisition Benefits to Customers
BayBuilder provides professional buyers with the negotiation tools to cut an average of 17%, and as high as 50%, from the total cost of direct and indirect goods and services.
PurchasePro is strategically suited to host BayBuilder's sourcing software, enabling buyers and suppliers to participate in reverse auctions in the domestic and international market.
BayBuilder's self-service technology enables buyers to craft auction times, logistics, and request for proposals within a real-time auction format, while enabling suppliers to sell more products.
BayBuilder's technology enables companies to perform an unlimited number of auctions without costly transaction fees.
BayBuilder provides buyers and suppliers with workflow, supplier survey (RFI), e-negotiations, reverse auctions, analytics, and decision optimization technology.
BayBuilder offers the easiest to use technology in the market with no integration challenges.
BayBuilder will be integrated into PurchasePro at strategic points making for a seamless user experience.
About PurchasePro
PurchasePro (Nasdaq:PPRO - news), a leader in business-to-business e-commerce, operates the PurchasePro global marketplace, encompassing more than 140,000 businesses and powering hundreds of private-label marketplaces with its highly scalable, browser-based e-commerce engine.
PurchasePro's solutions enable businesses of all sizes to easily buy and sell products and services, and compete more effectively by enhancing sales opportunities, reducing procurement costs and greatly increasing employee productivity. PurchasePro responds to the most common corporate needs: e-Procurement for corporate procurement, v-Distributor for online distributors, and e-MarketMaker for Internet market makers.
PurchasePro has developed strategic sales and marketing relationships with industry leaders including America Online, Computer Associates, Gateway, Hilton, Office Depot, and Sprint. The company provides extensive support and training programs. For information, call toll free at 888/830-4600 or in Las Vegas at 702/316-7000 or visit www.purchasepro.com.
About BayBuilder
Net Research Inc., d.b.a. BayBuilder, is a provider of strategic sourcing software and services based in Boca Raton, Fla. BayBuilder's clients are comprised of Global 2500 companies and selected government units that need a proven, reliable end-to-end solution for the entire strategic sourcing process. Prominent users from a wide roster of industry groups include chemical-maker PPG Industries Inc., technology manufacturer Lexmark International, building materials leader Owens Corning, and heating industry leader Lennox International. Purchasing professionals at these enterprises, and others, recognize that BayBuilder's ASP model of delivery combines the best in market-driven content, reliable technology and experienced process support. |
