WebMethods Dips Despite i2 Deal

WebMethods (Nasdaq: WEBM) erased anearly-morning gain and was trading at US$25.56, down 13 cents, inmidmorning trading Monday, after the company announced a softwarepartnership with i2 Technologies (Nasdaq: ITWO)that includes the issuance of a warrant giving i2 the right to purchase upto 750,000 WebMethods shares.

WebMethods, of Fairfax, Virginia, said i2 will use its software as a “coreoffering” in its TradeMatrix products under the multi-year agreement,while WebMethods will promote and market i2’s products. The two are alsodeveloping joint sales and marketing plans.

The companies said the partnership will “help companies quickly connect withtrading partners in both public and private marketplaces,” reducing costsand saving time for companies that do business over the Internet.

i2 plans to have products integrating webMethods software by the thirdquarter of this year, the companies said.

WebMethods reported a 237 percent increase in revenue for the third quarterended December 31st, as income before special charges totaled US$2.7 million,or 5 cents per share — above analysts’ estimates of a penny per share –compared with a loss of $15.5 million, or 82 cents, in the year-earlierquarter.

After acquisition and other charges, the company posted a net loss of $12.7million, or 27 cents per share, against a loss of $15.5 million, or 82cents, a year earlier.

i2 also beat forecasts for its latest fiscal quarter. The Dallas, Texas-based makerof business-to-business (B2B) software said revenue for the quarter climbed116 percent from a year earlier to $378 million. Chairman and chiefexecutive officer Sanjiv Sidhu said the company did not see signs of aslowdown in business.

i2 was down 75 cents at $18.75.

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