Art Technology Group (ATG) Inc. has announced its intention to acquire Primus Knowledge Solutions Inc. in an all-stock deal valued at between $30m to $33m that will bring two unsteady vendors together.
ATG, which is gradually ramping up its applications capability as it continues its move away from infrastructure, operates in the ecommerce and online customer experience sub sector of the CRM market. One of its key strategic goals this year has been the development of online service and particularly self-service functionality based around its personalization engine.
Primus’s activities are highly complementary because it specializes in the provision of customer service software, using knowledge management and email management technology to support e-service functionality.
Historically, Primus has competed against players like eGain, Inquira, iPhase Technologies, Kana, Kanisa and RightNow Technologies while ATG competes against Blue Martini, Broadvision on the ecommerce side and Chordiant, E.piphany and Kana on the CRM side.
Neither company is faring well, each suffering falling revenue and reporting net losses. For the quarter ending June 30, 2004 ATG reported a loss of $4.2m on revenue of $14.3m. For the same period Primus made a loss of $2.1m on revenue of $5.6m. When combined, the two players hope to generate annual savings of $10m to $15m, starting from 2005. The acquisition is expected to close in Q4 2005.