Andover, Mass.-based hosting specialists NaviSite, Inc.on Thursday announced the acquisition of managed application services firm Avasta in a transaction that includes about $10 million in financing from Atlantic Investors, LLC.
NaviSite, a former CMGIsubsidiary, said the deal would help its transformation as a managed application provider for mid-market enterprises. The deal comes less than a year after NaviSite sold off its streaming media unit to N.J.-based Streaming Media Corp.
Terms of the acquisition calls for NaviSite to issue 231,039 shares of its common stock at closing and up to an additional 1,004,518 shares if Avasta achieves certain revenue targets through June of 2003.
The deal also calls for Atlantic Investors, LLC to provide a loan of $1.5 million to fund Avasta’s operations and up to an additional $8.5 million to fund NaviSite working capital. Atlantic Investors, LLC, is an investor in ClearBlue, which was also acquired by Navisite earlier this year.
Avasta mid-market enterprise clients include Documentum, Golden State Vintners, R&L Carriers and Wilbur-Ellis.