Wednesday, February 20, 2008

CMGI to buy Open Channel for $11M

Storied software company CMGI Inc. is back in the Internet business acquisition game, announcing plans to purchase Open Channel Solutions Inc. for $11 million in cash.

Open Channel, which is based in Dedham, is a developer of entitlement and e-business management solutions. The acquisition is scheduled to close during CMGI's fiscal third quarter, officials said.

Open Channel is expected to operate as a wholly owned subsidiary of CMGI, which is based in Waltham.

Open Channel was spun out of Modus Media International in 2001. Following CMGI's acquisition of Modus Media International in 2004, CMGI assumed a minority interest in Open Channel, which is held as part of CMGI's venture capital business, @Ventures.

Because it owns a minority interest in Open Channel, CMGI's net purchase price will be $11 million, officials said.

Open Channel operates offices in Dedham, Utah, the Netherlands, Japan and Australia.

For fiscal 2007, CMGI reported net income of $49.4 million on revenue of $1.14 billion.

CMGI became a brand-name Internet company in the late 1990s as a holder of several successful companies that were either sold or went public. As the economy slowed, it exited much of its Internet-focused holdings, and has since focused mainly on supply chain and fulfillment businesses.