Open Market Set To Be Acquired By Divine

By Amy Rogers, CRN
August 16, 2001 10:49 AM ET

Thanks to a pending acquisition valued at $59.3 million, Open Market is likely to be the latest company rescued by Divine intervention.

The troubled e-commerce software developer is set to be acquired in an all-stock deal by Divine, based here and headed by CEO Andrew "Flip" Filipowski, who founded Platinum Software, which was acquired by Computer Associates International in 1999.

Divine develops portal, CRM and workflow applications, and also offers managed services and consulting.

Terms of the pending deal call for Divine to acquire outstanding shares of Open Market common and preferred stock in exchange for about 44,285,000 shares of divine Class A common stock. Based on Divine's closing price on Aug. 14, the deal is valued at about $59.3 million.

Open Market stockholders are expected to receive about 0.8230 shares of divine stock in exchange for each share of Open Market stock.

Burlington, Mass.-based Open Market has struggled over the past two years through layoffs, a rapid succession of CEOs and fierce competition in a market it once laid claim to, content management. Former CEO Gary Eichhorn guided the company through a difficult turnaround following a sales slump in 1998 that necessitated the subsequent layoff of 20 percent of the workforce.

Eichhorn left in February 2000, followed by Ron Matros, who held the CEO post for only seven months. Current CEO Harland LaVigne made clear at the time of his appointment that he was there on an interim basis.

Further details about the acquisition are expected in a conference call this afternoon.

Open Market, which yesterday signed Ford Motor as a customer, was trading at $1.07 per share on Thursday morning.

In recent months, Divine also acquired assets of managed services provider Intira and e-business solutions provider MarchFirst.

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