An 'Olé!' for Ariba and i2 as IBM Puts $90 Million Where Its Mouth Is

Business-to-business firms i2 Technologies (ITWO Quote - Cramer on ITWO - Stock Picks) and Ariba (ARBA Quote - Cramer on ARBA - Stock Picks) both climbed in trading Thursday as a $90 million advertising campaign from their ally, IBM (IBM Quote - Cramer on IBM - Stock Picks), was cast as a solidifying force of the triple alliance.

Ariba gained 4%, or 5 9/16, 143, and i2 jumped about 8%, or 11 1/16, to 157 5/8. IBM was up fractionally.

The moves came on the day IBM announced the ad campaign to highlight the previously announced partnership. Both smaller members compete fiercely with firms like Oracle (ORCL Quote - Cramer on ORCL - Stock Picks) and a similar partnership between Commerce One (CMRC Quote - Cramer on CMRC - Stock Picks) and German software-maker SAP (SAP Quote - Cramer on SAP - Stock Picks) for slices of the surging B2B e-commerce sector.

While an ad campaign might not seem like something that would light a fire under these already heady stocks -- both Ariba and i2 trade at rich multiples -- analysts say the move shows the alliance is real. Both Ariba and i2 had fiercely competed with the other and some investors raised an eyebrow at the reality of the partnership.

"I think people are surprised that IBM is being so aggressive with it," said Morgan Stanley Dean Witter analyst Chuck Phillips. "There have been various levels of skepticism on how committed the partnership was."

"I think IBM is playing the big brother, and keeping both of them in line, from what I hear," added Phillips, who has an outperform rating on i2 and a strong buy on Ariba. Another Morgan Stanley analyst rates IBM an outperform. Morgan Stanley has performed banking services for all three companies.