VerticalNet, Inc. (Nasdaq: VERT) rose 1 7/64 to 29 Wednesday after the company said Sumitomo Corp. agreed to purchase $30 million of its common stock.
Under the agreement, the Japanese trading company will buy the stock in a private placement as part of an expanded relationship that may extend to the creation of a VerticalNet exchange in Japan. Sumitomo may also become an equity partner in VerticalNet’s international ventures, and begin licensing and distributing the company’s products.
“Sumitomo’s long-standing relationships in diversified global industries will be invaluable as we expand our international operations,” said Joe Galli, president and chief executive officer of VerticalNet.
The Horsham, Pennsylvania-based business-to-business (B2B) company and Sumitomo already have an Asian joint venture, the NECX Exchange, which has created more than $70 million in transactions during two years of operation.
“We will initially focus our cooperation on exchanges to pursue new business opportunities, alliances and transactions in global e-commerce markets,” said NECX president Larry Marshall.
Sumitomo managing director Atsushi Nishijo said the new agreement is “a natural evolution” for the company’s integrated trading business.
“The combination of our expertise in sectors such as aerospace, automotive, plastics, metals and finance, and VerticalNet’s leadership in creating and operating online exchanges and marketplaces with its enabling software infrastructure, will position the two companies in the forefront of global B2B e-commerce,” Nishijo said.
The companies said they will complete the stock deal after receiving regulatory approval. The shares will remain unregistered for at least a year.
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