USWeb to Buy CKS Group for $344.4 Million in Stock
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USWeb will exchange 1.5 shares for each of CKS Group's 15.9 million diluted shares outstanding. The new company will change its name to Reinvent Communications Inc.
The value of the deal amounts to roughly $216 million, based on 15.1 million CKS shares outstanding at May 31, the most recent date for which figures were available.
USWeb, whose shares almost doubled since its initial public offering in December, made dozens of acquisitions to offer more services to companies looking to use the Web to improve their businesses, according to Bloomberg News.
Cupertino, CA-based CKS closed at $15.25, up $1.12, while USWeb closed at $12.31, down $2.12.
CKS Group Chairman Mark Kvamme will become chairman of Reinvent and USWeb Chairman Joe Firmage will be chief executive.
USWeb said it expected to complete the acquisition in late 1998, adding that the deal would be accounted for as a pooling of interests.
"Reinvent will be positioned to leverage the dramatic impact the Internet and other high-velocity communication systems are having on companies and markets throughout the world," the company said.
"Our clients face increasingly complex IT (information technology) challenges and commoditization of their products and services," said Kvamme. "Reinvent will be a single partner with the breadth of capabilities and depth of knowledge to tackle these challenges."
"Reinvent will marshal over 1,800 professionals worldwide to deliver. . . technology and marketing communications services," Firmage said in a statement.