With the agreement, which has already been approved by each company's boards of directors, all 15 million shares of Andover.Net (ANDN) common stock will be exchanged for .425 of VA Linux Systems (LNUX) common stock. VA Linux is also paying $60 million in cash.

VA Linux will control the popular open source developer network, reinforcing its position as the only public company in the United States to offer exclusively open source systems, software, service and Web-based developer solutions.

VA Linux said the goals of the acquisition will be to:

• Consolidate the networks of VA Linux, which include Linux.com, Sourceforge.net and Themes.org with Andover.Net's Slashdot.org and Freshmeat.net to create a leading destination for open source developers, with nearly two-thirds of the total traffic of major open source sites and putting the combined network in the top 100 Web destinations worldwide
• Coordinate the activities of the leading Web sites for open source development projects
• Increase the opportunity for sponsorships and business partnership revenues across the company's network
• Expand the range of VA Linux's products and services, such as the announcement last week of consulting to Hewlett Packard's printer division in its open source software plans
• Combine the companies' teams, building next-generation services and e-commerce infrastructure for faster time-to-market

Andover.Net Chief Executive Officer Bruce Twickler called the deal a "perfect match."

"We both believe that live software communities on the Net are more important than packages that ship once every three years and companies that simply intermediate between developers and users," Twickler said.

The purchase makes sense as Andover.Net accounts for more than 50 percent of the visits to Linux destinations. VA Linux's deal is a sign of the increasing popularity of open source with major players such as IBM Corp. (IBM), Hewlett-Packard Co. (HP) and Intel Corp. (INTC) embracing the Linux operating system.