News

Global eXchange dons HAHT for $30M

• By Rich Seeley
• January 15, 2004

B2B e-commerce software and services provider Global eXchange Services (GXS) said it will pay about $30 million for HAHT Commerce Inc., one of the first Java-based application server makers. HAHT has most recently positioned itself as a software provider of real-time supply-chain data solutions for retail companies.

The deal, which will be financed by a combination of cash and shares of GXS Holdings, the parent company of Global eXchange, is scheduled to be completed in February following approval by HAHT shareholders.

Retail industry demand for real-time supply-chain data was the driving force behind the planned acquisition, according to a GXS executive.

"GXS' goal all along has been to connect trading partners whether they are retailers or buyers or suppliers and sellers," explained Bobby Patrick, senior vice president of marketing at GXS. "We connect more than 100,000 of those trading partners today."

But providing B2B connectivity for the retail trade addressed only part of the problem of providing access to the accurate real-time data the industry is demanding, he said.

"The big problem is that every company stores data, product information and pricing information for example, in a unique way," Patrick said. "A supplier has many retailers and a retailer has many suppliers."

Inefficiencies resulting from the inability to synchronize data between retailers and suppliers in real time is resulting in a significant loss in sales revenue, which one analyst estimates to be as much as $40 billion annually.

HAHT's Java-based commerce platform and applications, and its middleware for integrating supply chains to ERP systems, will help solve the problem of inefficiencies in supply-chain networks by delivering accurate real-time data, Patrick said.

While HAHT is a small 79-person company, compared to GXS, which has annual revenue of more than $400 million, its technology is vital to GXS' goal of getting accurate pricing and inventory data into its B2B network, he said.

Patrick said the two companies' software is complementary and compatible enough that GXS under a concurrent agreement with HAHT can begin marketing both companies' products immediately. He said the product integration is expected to be completed shortly after the sale is finalized.