NetIQ to Buy WebTrends for $1 Billion in Stock
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E-business infrastructure management company NetIQ said Wednesday that it plans to buy Web traffic analytics and intelligence firm WebTrends for about $1 billion in stock, with the goal of combining product lines to form what spokespeople say is "the most comprehensive" infrastructure management and intelligence software company.
Under the terms of the transaction, which was approved by both companies' boards of directors, shareholders of Portland, Ore.-based WebTrends will receive 0.480 shares of NetIQ stock -- or equity worth about $35, based on NTIQ's Tuesday closing price of $75 -- for each share that they own.
According to officials at the firms, the purchase will position San Jose, Calif.-based NetIQ to provide enterprise organizations, online businesses and service providers a full range of solutions, from back-end technology to front-end Web servers and applications.
The new company will feature product lines for systems administration, network performance management, operations management, security management, Web management, and Web business analytics and intelligence. Through the acquisition, NetIQ also signals its intent to branch out to platforms beyond Windows.
"This combination is the logical next step in our strategy to become the unparalleled leader in e-business infrastructure management and intelligence solutions," said NetIQ chief executive officer Ching-Fa Hwang. "By joining forces with WebTrends, we will significantly enhance our offering and deliver the most comprehensive solution for managing both Windows- and non-Windows-based platforms such as Linux and Sun Solaris, applications and devices, and Internet-based systems."
Once the transaction is complete, NetIQ shareholders will own about 76 percent of the company. The new NetIQ will have a market cap larger than $4 billion, pro forma calendar 2000 revenues of about $160 million, more than 52,000 customers and about 1,000 employees.
"This combination is a strategic fit that brings together two leaders focused on helping companies increase the return from their e-business initiatives, from NetIQ's comprehensive infrastructure management through WebTrends' Visitor Relationship Management solutions," said WebTrends chief executive officer Eli Shapira, who will become NetIQ's chief strategy officer.
Shapira also will join NetIQ's board of directors. Glen Boyd, currently WebTrends' president and chief technology officer, will become chief information officer of NetIQ, while WebTrends' chief operating officer Dan Meub will become senior vice president of WebTrends products at NetIQ.
The purchase is subject to regulatory and shareholder approval, and is expected to close late this quarter or early in second quarter.
At press time, shares of NTIQ were down 14.5 percent to $64.125, while shares of WEBT were down 9.13 percent to $29.88.