NetZero Acquires for $23.5 Million

In a move to beef up its personalization and ad targeting capabilities, advertising-supported free ISP NetZero Inc. on Thursday agreed to acquire technology firm Inc. in a cash-and-stock transaction estimated to be worth $23.5 million.

The deal calls for NetZero to pay $2.6 million in cash, and 2.5 million shares of stock — worth $20.9 based on Wednesday’s closing price. NetZero’s stock closed at 8 3/8 on Wednesday, and was unchanged in early morning trading on Thursday.’s technology, which NetZero will integrate into its free ISP service, allows for the analysis of users’ behavior on the Internet, by looking at actions like keyword searches, click-through data, and other information. That data can then be used to target advertising and other offerings to these consumers.

NetZero hopes the technology will allow it to more effectively target advertising — for which it can charge marketers more money. In addition, it wants to use’s solution to enhance its newly-formed CyberTarget division, which will take anonymous data collected from its members and sell it as market research. NetZero says it has four million subscribers across the United States.

“’s technology integrated with NetZero’s product offerings has the potential to transform the state of targeted marketing and personalization as it exists today,” said Jeff Stibel, chairman and chief executive officer of

“Combining’s powerful cognitive and linguistic technologies with NetZero’s existing capabilities creates a very compelling business proposition in the areas of personalization and targeted marketing on the Internet. Perhaps the most exciting aspect of the merger is the opportunity to drive one-to-one marketing to new levels.”

The acquisition is expected to close in the third quarter of 2000.

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