by Deborah Gage
Andersen Consulting this fall plans to open a yet-to-be-named "eProcurement venture" for customers
to procure office supplies, computer equipment, airline tickets and other indirect goods.
AC Ventures, Andersen's venture-capital arm, has made a majority equity investment in new venture. Sun Microsystems
has made a minority equity investment and will supply Andersen with up to $300 million worth of hardware, services
and iPlanet software over a three-year period. The new venture also will become a majority shareholder in hpi GmbH,
formerly Hoechst Procurement International, a Celanese company with 50 clients that manages $2 billion in indirect
Andersen CEO Joe Forehand says Andersen has signed letters of intent with customers across geographies in the
financial services, automotive, telecommunications, chemicals and food products industries that will represent
more than $20 billion in aggregated spending when the agreements are finalized.
The new venture will earn transaction fees and category-management fees, but will outsource the major IT components
to ISPs and other providers. "We'll focus on procurement and the supply-chain-management function," Forehand
IPlanet, meanwhile, has committed to putting developers behind the venture.
Andersen has taken extraordinary steps lately to attract and retain talent, to compete with Web integrators
and dot-coms. Observers also note that iPlanet is not a leader in the procurement software space.
Dow Bauknight, former managing partner of Andersen's Supply Chain line of business, was named president and
CEO of the new venture.