Electronic purchasing and spend management software company SciQuest (NASDAQ:SQI) is boosting its capabilities with the acquisition of CombineNet in a cash and stock deal valued at $43 million.
Cary-based SciQuest spent $26 million in cash and bought approximately 820,000 shares of CombineNet’s common stock in the deal. CombineNet, based in Pittsburgh, provides sourcing software to large companies that have complex procurement needs that go beyond typical e-procurement software.
SciQuest’s software automates and streamlines online purchasing decisions for a customer base consisting of government bodies and institutions, such as universities. But CombineNet targets customers with more specialized e-procurement needs. Its approximately 100 customers across the globe are Forbes Global 2000 companies that include leaders in the retail, consumer packaged goods, restaurant and food and beverage manufacturing industries.
In a video explaining the acquisition, SciQuest CEO Steve Wiehe said that many of the company’s commercial customers said that their sourcing needs were too complex for software tools that were available to them. Wiehe said that CombineNet’s software is customizable and can balance factors such as costs, risks and preferences enabling companies to make better spending decisions.
CombineNet and SciQuest are not strangers to each other. Wiehe said that SciQuest has partnered with CombineNet over the last several years on sourcing, spend analytics and contract management life cycle solutions.
“This acquisition is a natural step in the relationship of the two companies,” Wiehe said.
SciQuest has been active on the acquisition front. In the last year, the company has completed two large acquisitions for Spend Radar and Upside Software, which is now known as SciQuest Canada.
SciQuest shares rose 28 cents to around $20.32 in after hours trading.