Ariba acquire b-process, French e-invoicing leader with a very dull name

It's quite a coincidence, we had a piece about e-invoicing and the new Spend Matters US research paper on the topic ready to publish today and... Ariba announced yesterday their acquisition of b-process, “a privately-held provider of France’s largest electronic invoice network and one of the largest e-invoicing networks in Europe”.

(We'll hold the other piece till tomorrow so we don't overload you with too much e-invoicing excitement today).

B-process has roughly US$ 11 million in revenues and the acquisition will “reduce (Ariba’s) non-GAAP EPS by approximately US$0.03 in fiscal year 2012”.  You tell me what that means… I guess it just says this isn’t that significant in terms of major change to Ariba’s earnings per share.

We do know that Ariba are paying 35M euros, which means by my calculation they’re paying 4.3 times revenues, which seems a high but not stupid multiple - and good news for the b-process shareholders. But for a market-leading firm in a pretty significant market, and one where I don’t believe Ariba are that strong, it may make good strategic sense. And of course Ariba are sitting on piles of cash and healthy ratios themselves..  Anyway, the market seemed pretty neutral about the deal, marking Ariba down 2% on the day in line with NASDAQ.

Here’s more on b-process:

“Certified by an independent accounting firm to handle value-added tax and invoicing regulatory requirements in 24 countries, b-process delivers a flexible set of solutions for e-Invoicing that are used by large buyer customers across industries, including: Carrefour, EADS, Eurocopter, Gefco, IATA, Marmara, Saint-Gobain and Vinci Energie. The solutions accept invoices in any type of structured format files, including positional, EDI, XML and PDF, allowing buyers and suppliers to quickly and easily connect to the b-process commerce network and begin processing invoices immediately, regardless of the AP, ERP, or other back office systems they are using… b-process transacts more than 40 million invoices annually with an estimated value of over $80 billion”.

What does it mean for b-process customers? Well, Ariba are not known for their low cost approach in terms of their supplier network, so that must be a concern for their current clients. Other European providers like Basware and Palette, and I’m sure some local French providers,  will be sharpening their competitive knives…

I’m not clear how much b-process will enhance Ariba’s own offerings in the e-invoicing arena – it sounds from the press release like it may be quite significant, but I’ll be interested to see what Mr Loughlin at Purchasing Insight has to say about this topic, as well as Jason Busch of course.

More to follow I’m sure…

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