TechTarget Acquires KnowledgeStorm


TechTarget has acquired KnowledgeStorm Inc., a search resource that targets the needs of IT professionals and vendors. The purchase price was approximately $58 million, which included about $52 million in cash at closing and 359,820 shares of unregistered common TechTarget stock.

TechTarget will certainly benefit from an established base of those professionals and vendors. According to a press release announcing the deal, KnowledgeStorm boasts an active advertising client base of about 700, most of which will be new to TechTarget. KnowledgeStorm also attracts about 3.5 million visits per month from IT professionals.

TechTarget expects the acquisition to help increase its value among both IT professionals and vendors--and the company predicts that will happen rather quickly. Also in the press release, Greg Strakosch, chairman and CEO of TechTarget, said the company expects KnowledgeStorm to yield revenues of $12-$14 million and adjusted EBITDA of $4.5-$5.5 million during the first 12 months after the two firms are integrated. That integration should be complete by the end of the second quarter of 2008, according to Strakosch.

This deal shouldn't be surprising to anyone in the industry; and it certainly makes perfect sense for TechTarget to acquire an organization with such complementary services. In fact, just last month, TechTarget launched a new service very similar to those KnowledgeStorm provided in that it helps educate IT professionals on topics of interest. ITKnowledgeExchange.com is a user-generated content site that enables visitors to collaborate with each other on industry-related issues.

The combination of content and resources from both KnowledgeStorm and TechTarget should be win-win for the companies and the customers they serve (both content-seeking professionals and lead-seeking advertisers). Their universe just got a little larger; something both customer segments expect from their resources these days.

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