Web services company Divine has agreed to purchase Internet services company Viant Corp. in an all-stock deal worth approximately US$88 million.
Under the agreement announced Friday, Chicago-based Divine will pay about 200 million shares of its stock for Boston-based Viant. At the end of trading on Friday, each share of Divine's stock was worth 44 cents. The stock has traded as high as $2.84.
According to the companies, each Viant shareholder will receive 3.977 shares of Divine stock. In addition, Viant will pay its shareholders $24 million before the acquisition is completed, but stockholders still must approve the deal.
Divine's plan is to extend its reach into the Northeast, officials said in a statement.
Despite the downturn in the economy, Divine last year acquired more than 30 troubled software vendors and providers of integration firms and managed application services companies.
"This acquisition reinforces Divine's strong financial position and is consistent with our goal to achieve profitability by the fourth quarter of this year," said Divine's chief financial officer, Michael Cullinane.
Joel Yaffee, an analyst at Giga Information Group Inc. in Cambridge, Mass., said Divine is focusing its resources in three areas: software, professional services and outsourcing/Web hosting.
"The company's goal is to create one-stop shopping that will enable businesses to extend their enterprises," Yaffee said.