The financial terms of the deal were not disclosed.
Andover, Mass.-based Engage said it has agreed to sell to Bluestreak some Adknowledge assets, including source code that lets marketers and advertising agencies place ads over the Web. Newport, R.I.-based Bluestreak has also acquired Engage's customer lists for the United States and other countries.
Engage added that it would cease to serve ads on its network after Sept. 23 and will shut down its entire media business Sept. 28. In August, the company announced plans to withdraw from online advertising and shift its focus to software sales for the content-management market.
Engage, which is majority-owned by CMGI, also cut its staff by 20 percent last month. The company said Thursday that its remaining 125 media-related positions will either move to Bluestreak or be terminated.
For Bluestreak, the acquisition builds on its efforts to strengthen its position in online marketing. The company already has strong backing, having nabbed $19.5 million in a round of financing earlier this year from investors including AOL Time Warner. In addition, the company unveiled a technology in February that lets advertisers include streamed audio and video in online and e-mail marketing campaigns.
The acquisition gives Bluestreak "an entry into a bunch of customers who now need ad-delivery software," said Jim Nail, senior analyst at Forrester Research. "Bluestreak will definitely be in the running."
Founded two years ago, Bluestreak provides advertisers, Web publishers and agencies with technology to develop and manage ads over the Web.
"What this acquisition does for us is it strengthens the market offering and really propels our business plan forward at an accelerated pace," said Gavin Finn, chief operating officer for Bluestreak. "It's a growth strategy."
The companies confirmed that the acquisition does not include Engage's database of anonymous consumer profiles. Privacy advocates were concerned that in the event of a sale, the privacy of more than 88 million consumers monitored by ad tracking technology could be compromised.
News.com's Stefanie Olsen contributed to this report.