Under the terms of the merger agreement, IntelliQuest has acquired all the outstanding stock of privately held Zona Research in exchange for 250,000 shares of IntelliQuest stock, a transaction valued at $5.25 million based on its close of 20-5/8 a share Tuesday.
Zona will continue to operate under its own name and serve as a wholly owned subsidiary of IntelliQuest.
"Zona Research has established itself as a leader in providing in-depth analysis and assessments of the business-to-business aspects of the Internet and intranet industries based on factual market data and observations," said Brian Sharples, IntelliQuest president, in a statement.
"Its subscription-based analyst business, combined with our innovative and full-service quantitative research capabilities, provides our customers with an extensive line of market assessment products."
Zona, meanwhile, is looking to enhance the quality of its assessments by leveraging IntelliQuest's leading-edge research capabilities, said Stephen Auditore, Zona Research president.
The deal making began last year, Auditore added. "We were approached by a number of people last fall. We've become a high-profile, successful company and thought IntelliQuest had a lot of synergies."
Auditore noted the company did not have plans to launch an initial public offering and never had any venture funding.
Zona will be joining a company that posted revenues of $26.5 million in 1996, an increase of 38 percent over the previous year. It also reported profits of $2.6 million, up fivefold from a year ago when it posted net income of $565,000.