January 20, 2000 5:35 AM PST
Engage Technologies to buy CMGI's Adsmart, Flycast
With the acquisition, Engage, which provides ad targeting technology to Web sites, can combine its Internet ad-marketing products with Adsmart's Web ad technology for online advertisers and Flycast's online direct response technology, the companies said in a statement.
CMGI, headquartered in Andover, Mass., said Engage's acquisition is part of the Internet venture fund's larger strategy to create a single, integrated Internet marketing company.
The deal will provide Engage, also based in Andover, with a complete suite of Internet ad and marketing products to sell to its customers and serve the growing needs of online marketers, the company said.
CMGI has been busy adding to its collection of Web ad companies--it acquired Flycast, Adforce and Adsmart late last year in its push to compete aggressively against top Web advertising company DoubleClick. In December, CMGI also announced plans to acquire email marketer YesMail.com.
Under the terms of the deal, Engage said it will buy San Francisco-based Flycast and Andover-based Adsmart from CMGI for about 32 million shares. Based on Engage's closing stock price yesterday of $76 a share, the deal is valued at about $2.4 billion.
Engage said it will immediately oversee the operations of Adsmart and Flycast, both of which will be fully integrated with Engage. The companies said Paul Schaut will remain as president and chief executive of Engage, while Flycast CEO George Garrick and Adsmart CEO John Federman will both join Schaut as presidents to oversee strategic operations for the combined company. CMGI CEO David Wetherell will continue to serve as chairman of the board for Engage.
The transaction is subject to certain regulatory conditions and the approval of Engage shareholders. The companies said they expect to close the deal in April or May of this year.