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Primus nabs another start-up

The maker of Web-based problem-solving software plans to merge with, a software developer, in a stock deal valued at $90 million.

Primus Knowledge Solutions today said it has signed an agreement to merge with in a stock deal valued at $90 million.

The deal sent Seattle-based Primus' shares soaring in afternoon trading--up 15 percent to 50.

Primus makes Web-based problem-solving software that companies use to support their customers online. Primus's software can be used to capture data, solve customer problems, reuse solutions stored in a database and share problem-solving data throughout a business.

Primus said it will use's technology to enhance its eService software product line. 2order's flagship product, Net Marketplace, is software intended to personalize a Net user's buying and selling experiences.

Under terms of the agreement, Primus will acquire all outstanding stock of in exchange for Primus common stock equal to $90 million. Once approved, will be a wholly owned subsidiary of Primus.

The merger will be accounted for as a pooling-of-interests and is subject to approval of shareholders.

The deal comes after Primus's acquisition last month of e-marketing company Imparto Software.

Primus competes with companies such as Epiphany, Kana, eGain, Brightware, Silknet, and others in the so-called eCRM (customer relationship management) market. International Data Corp. projects that market to grow to $12.5 billion in 2003 from $2 billion last year.

Primus itself is growing rapidly. Customers including Compaq, Novell, Motorola, Lucent and EMC use its software to reduce the time it takes to resolve customer inquiries. Primus's third-quarter revenues jumped 186 percent with 211 percent new license growth compared to the year-ago quarter.

The company is expected to report about $7 million in fourth-quarter revenues.