Forrester to buy fellow tech researcher
The company is set to purchase Giga Information Group in a deal worth around $51 million, as the research sector continues its consolidation.
Forrester will pay $4.75 per share for all outstanding shares of Giga, a considerable premium for the stock, which closed at $1.56 Friday.
The merger of the research firms, both based in Cambridge, Mass., is expected to close by the second quarter, and may finish on the early side depending on how many of Giga's outstanding shares are tendered. Giga founder Gideon Gartner, who owns 17 percent of the stock, has already given his approval for the deal, as has W.R. Hambrecht, which owns 15 percent of Giga's stock.
Research firms that study the tech industry have faced the same problems as the companies they're analyzing--a sagging economy and the resulting doldrums for IT spending. The sector has been consolidating over the last few years.
Jupiter Media Metrix recently sold part of its measurement business to rival ComScore Networks for $1.5 million. It had already sold its AdRelevance online ad measurement business to Nielsen/NetRatings.
Forrester announced a reorganization in July, which included layoffs. The company recently reported a drop in third-quarter revenue, to $21.9 million from $34.4 million a year earlier. It said the Giga deal should bring in around 900 new clients.
"We believe that this acquisition significantly expands our coverage and reach," Forrester CEO George F. Colony said in a release.