Updated from 6:52 a.m. EST

i2 Technologies


announced Monday that it will buy

Aspect Development


in a deal valued at $9.3 billion in stock, the largest transaction to date in the software maker industry.

The move will strengthen i2's already significant presence in the booming business-to-business e-commerce segment. It also surpasses the $4 billion that

Computer Associates

(CA) - Get Report

agreed to plunk down for

Sterling Software

(SSW) - Get Report

in mid-February.

Under the terms of the agreement, i2 will exchange 0.55 share for each share of Aspect Development, after Aspect starts trading Monday on a post 2-for-1 split basis.

Based on Friday's closing prices, the deal had valued Aspect at $114.40 a share, a premium of 35% over its initial post-split price of 85. i2 will issue or reserve for issuance about 44.9 million shares of its common stock for the deal.

But that premium narrowed on Monday as i2's shares sold off. i2 dropped 16 13/16, or 8%, to close at 191 3/16, while Aspect gained 11 13/16, or 14%, to close at 96 13/16. i2 fell in part because "a lot of people that invest in i2 are not familiar with Aspect Development," said analyst Chris Rowen of


. However, he expects the stock to be down only temporarily because the deal is a favorable one. He upgraded i2 from an outperform to a buy on Monday's news and his firm has done no underwriting for the Dallas-based company.

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The addition of Aspect, which is based in Mountain View, Calif., will enhance i2 and its

alliance with





(IBM) - Get Report

announced last week. "The initial stock market euphoria over B2B e-commerce focused on the supply chain functionality of Ariba and

its rival

Commerce One


," Rowen said. "Now investors are digging deeper and looking at other companies that deal with B2B infrastructure."

i2 and Aspect Development are two of those companies. Ariba can tell a potential purchaser where to find products, but i2 gives information such as where the item is in stock and at what level as well as how soon it can be available. Meanwhile, Aspect categorizes and codes items and tells potential purchasers whether similar products can be substituted for each other.

"These are unique products that fill a very critical need," Rowen commented. "I can't think of three or five other players who together can do the same thing."

Aspect's chairman and chief executive, Romesh Wadhwani, will become vice chairman of i2 and join its board of directors.

The new company will employ 4,000 people. The deal is expected to close in June or July.

As businesses strive to create online marketplaces for their dealings with each other, companies positioned in the B2B e-commerce space are a hot commodity as they try to streamline procurement and build in other cost savings.

In related news, i2 also agreed to buy


, a San Francisco-based designer of Web products, content and services, for $380 million in stock.

i2 expects both deals to be neutral to 2000 cash earnings and accretive to 2001 cash earnings. They will also result in "substantial" one-time charges and ongoing substantial amortization of intangibles, according to i2.