Internet software maker Inktomi Corp. (Nasdaq: INKT) said Wednesday it will buy FastForward Networks for about $1.3 billion, acquiring its technology for live broadcasting over the Internet.
The company said the deal propels it into the Internet broadcast market, projected to reach $40 billion by 2003, according to data from the Aberdeen Group. Inktomi will offer the software for live broadcasting to its customers, including content delivery networks and service providers, as well as the recently announced Content Bridge alliance.
Inktomi shares were down 0.75 to 110.25. The stock jumped in August on an upgrade in August.
The FastForward Networks platform allows for millions of viewers and thousands of simultaneous media broadcasts. Its current customers include leading content distributors such as Digital Island and The Real Broadcast Network.
Under the terms of the deal, about 11.9 million shares of Inktomi will be exchanged for all outstanding shares, options and warrants of FastForward Networks. Based on Inktomi's September 12, closing price of $111 per share, the deal is worth $1.3 billion. Inktomi expects to account for the transaction under the pooling of interests method.
Following closing, expected in the quarter ending December 31, FastForward Networks CEO will operate the company as general manager of Inktomi's Media Division.