Ariba Inc. –

SUNNYVALE, Calif. – Ariba Inc., a provider of business-to-business e-commerce solutions, held an initial public offering June 23. The company offered 5 million shares at $23 apiece, above its $20 to $22 filing range.

Morgan Stanley Dean Witter, Dain Rauscher Wessels, Deutsche Banc Alex Brown, Merrill Lynch & Co., Discover Brokerage Direct and E*Trade Securities underwrote the IPO, which left 42.75 million shares outstanding.

There were no selling shareholders. Benchmark Capital Partners and Crosspoint Venture Partners 1996 are venture backers.

Ariba automates the purchase of operating resources such as information technology and telecommunications equipment, professional services, supplies, facilities and office equipment. Operating resources, which often account for almost one-third of a company’s expenditures, have been traditionally bought via paper-based processes. With the rise of intranets and the Internet as a business medium, however, businesses can now automate enterprise-wide and inter-organizational commerce activities.

The $105.4 million in proceeds generated by the IPO will be used for general corporate purposes.

Ariba has not been profitable in recent years, losing $11.0 million in 1998 and $4.7 million in 1997.

Robert Kagle, a managing general partner of Benchmark, and John Mumford, a managing partner of Crosspoint, joined the company’s board of directors at its inception in September 1996. Paul Hegarty, a co-founder of the company and former entrepreneur-in-residence at Benchmark, became a board member in October 1998.

Ariba – Selected Financial

(in thousands, except per share data)

Year Ended September 30, Six Months Ended March 31,

1997 1998 1998 1999

Total revenue 760 8,363 1,215 16,338

Net loss -4,679 -10,953 -5,299 -8,128

Net loss per share -7.31 -1.90 -1.19 -0.84