May 6, 2004 9:48 AM PDT

NaviSite buys out rival Surebridge

Technology services firm NaviSite announced on Thursday the acquisition of Surebridge, a privately held company offering similar services, in a cash-and-stock deal.

Surebridge, which specializes in Microsoft Business Solutions, PeopleSoft and Siebel Systems offerings, is the sixth company to be bought by NaviSite since September 2002.

NaviSite will issue two promissory notes worth $39.5 million, and 3 million shares of stock worth $14.7 million, based on yesterday's closing price. NaviSite said it is planning to close the deal later this month.

NaviSite expects additional revenue of about $11 million from the deal and hopes to report $3 million to $4 million in earnings, before taxes and other costs from the combined entity, in the quarter ending Oct. 31.

A separate statement from the company said it appointed John Gavin, formerly at Novell's Cambridge Technology Partners, its new chief financial officer.

 

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