Digital River Acquires Orbit Commerce

Moving to extend its reach to small and mid-sized enterprises, e-commerce outsourcer Digital River Inc. is acquiring e-business services platform provider Orbit Commerce Inc. for $964,000 cash and about $5 million worth (approximately 728,000 shares) of Digital River stock.

Minneapolis-based Digital River’s stock has been trading in the $7 range recently; at mid-day it was at $6.89, down 56 cents.

Digital also announced the August acquisition of Inc., a provider of e-commerce services for publishers and vendors of software and shareware.

“These acquisitions offer us strong market and partnership opportunities as well as new channels for growing our business,” said Joel Ronning, Digital River’s
CEO. “… we plan to … expand our market among small to mid-sized enterprises and generate new business opportunities.”

As part of its agreement with Chicago-based Orbit, Digital said it intends to maintain the strategic channel partnerships that Orbit has established with Gateway Inc., VeriSign, Cincinnati Bell and other large enterprises. Orbit enabled these partners to establish e-commerce and content management solutions for their SME customers by delivering its integrated suite of e-commerce applications via Web-enabled templates.

Digital River said it plans to leverage its e-commerce system and Orbit’s channel
partnership model to support a growing base of SME sites. Prior to the acquisition, Orbit’s channel partners generated a base of approximately 3,500 sites. During the next year, Digital River plans to transition these sites to its e-commerce platform, substantially increasing the number of sites it hosts.

Digital River plans to maintain an office in Chicago and retain a staff of approximately 15 former Orbit employees who will provide client services, project management and technical support.

The acquisition of Orbit follows Digital River’s Aug. 2 acquisition of, which offers over 5,000 software, shareware and other electronic titles on its Web site for purchase and registration. Digital said it paid $750,000 in cash and a note for $2.5 million. will continue operations as a separate entity.

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