Details emerge about Ariba's proposed buy of Procuri

Product roadmap still unclear, but interview sheds some light on business intgration plans

By Maria Varmazis -- Purchasing, 9/24/2007 12:32:00 PM

In a follow-up interview with Purchasing about their recently announced merger plans,

representatives of software firms Ariba and Procuri gave little detail about the product integration strategy going forward, but did shed some light on the reasons for the deal and the business integration plans going forward.

But Christine Crandell, Ariba’s vice president of corporate marketing, told Purchasing that Procuri's strength in the on-demand market—notably with midmarket firms in the sub-$2 billion range—is viewed as a major asset to Ariba, which she said is strongest with customers in the $5 billion-plus range, which didn't necessarily prefer on-demand software. 

"Going down market is a different way of doing business and it requires a different mindset and skillset, and Procuri has had substantial success in this area while we've historically struggled going down market," said Crandell, "So we see this as a complimentary marriage." 

Tim Minahan, Procuri’s senior vice president of marketing, said there are some business areas where Ariba and Procuri’s offerings are "complementary and not overlapping," citing Ariba's "strong global consulting base and commodity expertise" as one asset that would mesh well with Procuri's procure-to-pay software, for example. 

Crandell acknowledged that, as with any acquisition, it will be a challenge to get staff from both companies on the same page and corporate cultures will have to be taken into consideration. Sales and marketing techniques could be one area where Ariba’s staff could learn from Procuri’s, however, as traditional behind-the-firewall software models might be sold as a suite to work on all aspects of a business, while on-demand software is typically sold in smaller packages for specific, smaller processes.

Crandell says the while the Procuri acquisition is part of Ariba’s overall push into the on-demand market, Ariba will continue to support customers that prefer to use behind-the-firewall software. Many U.S.-based companies, she says, use both on-demand and installed software for different processes within the company, whereas companies based in Asia--a high-growth area where Crandell says Ariba is "gaining quite a bit of traction" and anticipates to continue growth--exclusively use on-demand software. 

"I am very optimistic on the growth that's going to be coming out of Asia, and having Procuri will only bolster the growth even more," says Crandell.

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