Ariba Acquiring Softface

Extends capabilities around spend data cleansing, enrichment and classification

Extends capabilities around spend data cleansing, enrichment and classification

Sunnyvale, CA — March 31, 2004 — Software company Ariba is acquiring spend data management specialist Softface in a deal that Ariba said would extend its capabilities around spend data cleansing, enrichment and classification.

Ariba has been on a spending spree of late, having already purchased e-sourcing specialist FreeMarkets at the close of last year and buying Alliente, a procurement business process outsourcing (BPO) provider, in January. The Softface deal, terms of which were not disclosed, moves Ariba into the spend visibility niche, too.

The acquisition, which is expected to close in early April, will give Ariba technology that helps organizations take problematic, largely unclassified data from multiple, disparate systems and convert that data into actionable spend information that can be leveraged to gain organization-wide savings.

"This acquisition brings highly advanced spend-visibility technology into Ariba, enhancing our ability to address a common, complex problem faced by most large corporations today, cleansing and classifying spend data across multiple enterprise systems," said Michael Schmitt, executive vice president and chief marketing officer at Ariba. "Combining Ariba solutions and domain expertise with Softface technology, Ariba can provide an automated, repeatable approach that allows customers to begin with the cleanest, most reliable spend data possible, information that is essential to successful spend analysis and sourcing efforts."

Ariba and Softface have been in a strategic relationship since July 2003. Under a partnership announced last November, the two companies were engaged in joint sales and marketing activities, and they provided customers with integration support. The two providers shared six joint customers, including PPG Industries, which is using the providers' joint offering to get more value from spend data coming from 20 different data sources and representing more than $5 billion of annual spend.

Jim Polak, director of general purchasing at PPG, offered a positive response to the acquisition news. "The combination of Ariba's spend management solutions and expertise with Softface's advanced technology for data cleansing and classification is great news for PPG, and we expect the combined solution will help us identify and save millions annually due to data quality issues alone," Polak said.

Tim Minahan, vice president of supply chain research at technology consultancy Aberdeen Group, noted that spending visibility and analysis are the critical first steps in any successful spend management initiative.

"Unfortunately, few companies truly know how much they spend and with whom, and it's costing businesses $260 billion in missed savings opportunities annually," Minahan said. "Combining Softface's advanced data cleansing, classification and enrichment technologies with Ariba's growing force of consultants and spend category experts will provide a compelling arsenal to attack this pervasive business challenge."