FreeMarkets Announces Strategic Agreement With Visteon Corporation
18 April 2000
FreeMarkets Announces Strategic Agreement With Visteon Corporation
Five-Year Agreement Is Largest Customer Contract to Date;
Provides for Multimillions in Revenue
PITTSBURGH, April 17 FreeMarkets, Inc. (Nasdaq: FMKT), the
world's leading B2B eMarketplace today announced that it has signed a
long-term strategic agreement with Visteon Corporation, a leading consumer-
focused, technology-driven automotive systems corporation. Under the terms of
the five-year, multimillion dollar agreement, FreeMarkets will provide Visteon
with access to its B2B eMarketplace for strategic sourcing. Visteon will pay
incremental, volume-based fees as it uses the FreeMarkets B2B eMarketplace
beyond specified market volumes. The agreement is FreeMarkets' largest
customer contract to date.
"We are very proud to be partnering with Visteon over the next five
years," said Glen Meakem, chairman and CEO of FreeMarkets. "Visteon is an
industry leader in using innovative technologies and systems integration to
serve customers. We view Tier One automotive suppliers as key customers for
our B2B eMarketplace, and we look forward to serving Visteon with our unique
combination of industry-leading technology, technical operations, market
making services and global database of suppliers."
As part of the agreement, FreeMarkets has issued warrants to Visteon to
purchase up to 1.75 million shares of its common stock for a nominal price.
The warrants will become exercisable in 2008, but can be exercised in annual
increments during the five-year term of the agreement, if certain revenue and
market volume targets significantly beyond the committed amounts are met.
About FreeMarkets
FreeMarkets is the original and the world's leading B2B eMarketplace, with
online markets for industrial parts, raw materials, commodities and services.
FreeMarkets created online auctions for over $2.7 billion worth of purchase
orders in 1999 and nearly $1.0 billion worth of purchase orders in 1998.
Since 1995, FreeMarkets has executed online auctions for products in more than
70 supply verticals, including injection molded plastic parts, commercial
machinings, metal fabrications, chemicals, printed circuit boards, corrugated
packaging and coal. More than 3,000 suppliers from over 45 countries have
participated in the FreeMarkets B2B eMarketplace. FreeMarkets is the only B2B
eMarketplace that includes industry-leading online auction technology,
technical operations, industrial market making services, access to a global
database of suppliers and supplier research, call center support to buyers and
suppliers in over 30 languages, and marketplace rules. The Company's current
customers include Visteon Corporation, United Technologies Corporation, The
Quaker Oats Company, Owens Corning, Eaton Corporation, Emerson Electric
Company, FirstEnergy Corp., SmithKline Beecham plc, Navistar International and
Delphi Automotive Systems Corporation. FreeMarkets can be found on the Web at
http://www.freemarkets.com. FreeMarkets is a registered trademark of FreeMarkets,
Inc.
Forward-looking statements
Statements in this press release that are not historical facts, including
those statements that refer to FreeMarkets' plans, prospects, expectations,
strategies, intentions, hopes and beliefs, are forward-looking statements.
These forward-looking statements are based on information available to
FreeMarkets today, and FreeMarkets assumes no obligation to update these
statements as circumstances change. There are risks and uncertainties that
could cause actual results to differ materially from the forward-looking
statements, including, without limitation, market acceptance of FreeMarkets'
B2B eMarketplace, the competitive nature of the market for business-to-
business online auction services, FreeMarkets' ability to retain and increase
revenue from existing clients and to attract new clients, FreeMarkets' ability
to attract and retain qualified personnel, the size of the market for used
equipment and surplus inventory, the demand for online auction and other asset
recovery services by buyers and suppliers, and FreeMarkets' ability to
integrate acquisitions. Risk factors are described in more detail in
FreeMarkets' filings with the Securities and Exchange Commission.
For more information, contact Karen Kovatch of FreeMarkets, 412-297-8767,
or kkovatch@freemarkets.com.