WebMethods Inc. (Nasdaq: WEBM) said Monday it will buy Active Software Inc. (Nasdaq: ASWX), a provider of enterprise infrastructure software, in an all-stock deal worth about $1.3 billion.
Shares in webMethods, which makes business-to-business integration software, closed at 87 Friday. The stock has slipped from a high of 336 1/4 reached shortly after its IPO. The company reported a strong fourth quarter.
The acquisition unites two business-to-business (B2B) infrastructure software companies.
Under the terms of the deal, Active Software's stockholders will receive 0.527 of a share of webMethods common stock in exchange for each share of Active Software. The transaction is valued at about $1.3 billion based on webMethods' closing price Friday. About 13.6 million shares of webMethods stock will be exchanged.
The webMethods deal is the second B2B merger of the day. Vignette (Nasdaq: VIGN) bought OnDisplay (Nasdaq: ONDS) for $1.7 billion.
By acquiring Active Software, webMethods will be able to offer a single infrastructure software package for internal and external business integration, the companies said. Until now, companies have been forced to adopt separate software for uniting internal business processes, and then sharing and integrating these processes with external trading partners, either directly or via B2B marketplaces and trading exchanges.
The acquisition will also add Active Software's management team and a large, blue-chip customer base, webMethods said. Phillip Merrick will continue as president, CEO and Chairman of webMethods. Jim Green, Active Software's CEO, will join as technology chief and executive vice president, product development. Green will also join the webMethods' board of directors.
webMethod's competitors include InterWorld (Nasdaq: INTW) and Open Market (Nasdaq: OMKT), according to Hoover's Online.
The transaction will is expected to close during the third quarter of 2000.