ChannelWave, Aqueduct Merge

ChannelWave, Cambridge, Mass., specializes in partner relationship management or (PRM) while Aqueduct focuses on business-to-consumer and business-to business e-commerce and services. Aqueduct is based in Aliso Viejo, Calif. The new company, which will carry the ChannelWave name, will maintain offices in both sites.

No financial details were released, although a ChannelWave spokesman said the company is "cash-flow positive out of the gate." It will employ about 90 people. He said no major layoffs are foreseen.

Rob Hagen, CEO of Aqueduct was named CEO of the combined company. Chris Heidelberger, who had held that post at ChannelWave previously will be president of the merged company and manage sales, marketing, and business development, a ChannelWave spokesman said.

The deal between Aqueduct, which started out four years ago as a Buy.com spinpoff, and five-year-old ChannelWave, was done on December 1, according to a statement. The two companies had talked about partnering and "decided that merging would best meet Aqueduct clients' needs for PRM functionality and ChannelWave customer requests for integrated commerce functionality as part of a channel management solution," according to the statement.

PRM systems are used by vendors to manage relationships with their resellers and distributors and to communicate with them. An effective PRM system would enable a reseller, for example, to track inventory and check on quota levels and even co-op dollar status, for example.

ChannelWave and Comergent have concentrated on PRM-specific solutions while other software powers like CRM leader Siebel Systems and ERP leader SAP have been expanding their existing offerings to include PRM capabilities.

With Siebel Systems buying Upshot, and the confusing round-robin bids for Pivotal, another CRM player, there is clearly consolidation underway in this space. (It now appears that Chinadotcom has won Pivotal, overcoming bids from Onyx Software and Oak Investment Partners, the venture capital fund in back of Pivotal.)