Royal Bank of Canada has acquired an equity stake in TradeMC, a B2B electronic procurement marketplace established by IBM and Fluor Corporation.
The TradeMC marketplace has been established to focus on indirect supplies and capital goods - such as office equipment and mobile phone services – as well as strategically sourced capital goods in the oil and gas, utilities, pharmaceuticals, mining, manufacturing and consumer products industries, among others.
As part of the agreement, Royal Bank is committed to contributing internal procurement spending to the marketplace. TradeMC plans to create a Canada-based operation for the purpose of attracting other anchor members who will be offered equity in the company for a commitment to bring spend to the marketplace and a cash investment.
Tom Wolf, senior vice-president, ebusiness at Royal Bank, says: "Liquidity is the key to success in an e-marketplace and TradeMC's ability to attract blue chip companies with large spends represents a unique competitive advantage over other marketplaces."
Under the deal, Royal Bank will feature as the preferred financial services partner for TradeMC and will provide services to the marketplace including payments, letters of credit and foreign exchange.
"Unlike other marketplaces, TradeMC targets both capital and indirect goods in the online procurement process to help members achieve even greater cost savings," says John Hopkins, president and CEO of TradeMC. "By combining Royal Bank's strong network of commercial and institutional banking customers with the technology and supplier relationships from our founders, we're positioned to capitalise on an area untapped by other exchanges."