B-to-B titans Chemconnect, CheMatch to merge

Two B-to-B exchange leaders for the chemical industry, Chemconnect and CheMatch.com, will be joining forces as a result of Chemconnect's plan, announced Thursday, to acquire bulk commodity chemical exchange CheMatch.

Combined, the Chemconnect online B-to-B marketplace for chemicals and plastics and CheMatch handled more than US$4 billion transactions in 2001. Financial terms of the deal were not disclosed.

The deal will provide buyers and sellers of chemicals and plastics a one-stop shop for e-commerce solutions, according to company officials.

Sergey Vasnetsov, an analyst with Lehman Brothers Holdings Inc., said the deal will benefit B-to-B buyers and sellers worldwide.

Chemconnect has successfully launched a subscription-based revenue model in addition to transaction fees and merged with Envera to provide end-to-end, online capabilities, Vasnetsov said. Now this acquisition consolidates the best offerings from the industry's two leading third-party B-to-B e-commerce companies, Vasnetsov said.

With the acquisition, Chemconnect will offer a comprehensive solution including online auctions, a commodity spot and futures exchange and an electronic communications hub for the automatic transfer of transaction data, according to company officials.

The new company will be called Chemconnect, and corporate headquarters will be moved from San Francisco to Houston.

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