Omniture Acquires Behavioral Targeting Company Touch Clarity
biz.yahoo.com
Wednesday February 14, 7:00 am ET
Combined Technology Now Delivers Automated Revenue and Profit Uplift for Customers, Increasing Addressable Market Opportunity
OREM, UTAH and LONDON--(MARKET WIRE)--Feb 14, 2007 -- Omniture, Inc. (NasdaqGM:OMTR), the fastest organically growing software company and a provider of online business optimization, today announced it has signed a definitive agreement to acquire privately held Touch Clarity, a leading on-demand provider of automated behavioral targeting. Under the terms of the agreement, Omniture has agreed to pay total consideration of up to $51.5 million (plus approximately $8.5 million in assumed vested stock options). The transaction is subject to customary closing conditions and is expected to close as soon as practical, no later than the first quarter of 2007.
Touch Clarity, headquartered in London, England, provides technology that uniquely combines the most sophisticated advancements in real-time predictive modeling, data mining and machine learning via the on-demand, software-as-a-service model. Touch Clarity's clients include industry leading Web sites such as AOL, HSBC, BT (British Telecom), Lloyds TSB, Barclays, Alliance Leicester, and lastminute.com. Touch Clarity is completely integrated with Omniture SiteCatalyst® through Omniture Genesis(TM) and is an accredited application partner of Omniture's Open Transaction Framework(TM) -- a simplified data collection process that utilizes the Omniture Universal Tag.
This strategic product and technology acquisition expands the Omniture Online Business Optimization Platform and positions Omniture to further accelerate growth -- adding a new level of automation and optimization. The acquisition is expected to give Omniture expanded market opportunities by providing new entry-point as well as cross-sell opportunities. In addition, Omniture will add more than 50 Touch Clarity personnel to its team, including 25 people in product engineering, with the balance in operations, client services, sales and marketing. The majority of this new team will continue to be based in London.
"We looked at all of the alternatives in the optimization market, and we know that Touch Clarity's technology is years ahead of the competition," said Josh James, CEO and co-founder of Omniture. "When you combine it with Omniture's platform, it is game changing. Previously, online business optimization was possible for Omniture's customers through leveraging our Web analytics data, but it was executed primarily by human interaction -- a limiting factor. Now, with this combined technology, we have online business optimization that delivers automated revenue and profit uplift for our customers."
"These technologies are highly complementary and are typically purchased by the same buyer," said Tim Brown, CEO, Touch Clarity. "In fact, one of our key sales criteria has been whether a company is using a top tier Web analytics provider because the two technologies are required to realize true automation."
"We've spent the last few years building one of the most advanced technologies available in the market and assembling a team of specialized engineering talent," said Paul Phillips, chief technology officer and founder, Touch Clarity. "Omniture now provides us with an ideal way to bring it to market in an accelerated way to meet the pent-up demand."
According to a recent Forrester Research report "The Reality of Behavioral Ad Targeting," "Several factors...have awakened marketers to the opportunity of online behavioral targeting. And, it's a win-win for marketers...Marketers that aren't already using behavioral targeting should be -- it increases click-throughs and improves conversion rates. Forrester believes that the widespread adoption of behavioral targeting is imminent and will...catalyze the rebirth of the online marketing suite."
Financial Information and Guidance
Under the terms of the agreement, Omniture has agreed to pay total consideration of up to $51.5 million (plus approximately $8.5 million in assumed vested options). The $51.5 million is comprised of the following: $16.0 million in cash at closing; up to $3.0 million in cash payable subject to an earnout based on certain revenue milestones for FY 2007; and $32.5 million to be paid in Omniture common stock or cash (or some combination of stock and cash), at Omniture's election, by November 30, 2007.
Touch Clarity's services are delivered as an on-demand subscription service, and thus the financial model is complementary to Omniture's on-demand business. Omniture will account for the transaction under purchase accounting rules, and thus a portion of Touch Clarity's deferred revenue from contracts signed prior to the acquisition date will be subject to certain limitations for GAAP reporting purposes. On an ongoing basis we will provide both GAAP and non-GAAP information for revenue and expenses in order to provide a basis for evaluating the Company's operating results because they facilitate the comparison of results for future periods with results from past periods. Assuming the transaction closes this quarter, Omniture is revising its guidance for the first quarter of 2007 and for the full fiscal year 2007 to the following:
-- Q1 FY 2007: GAAP revenue for the company's first quarter is expected
to be in the range of $26 million to $27 million. GAAP net loss is
expected to be in the range of $0.11 to $0.10 per diluted share. Excluding
the effect of stock-based compensation expense, the amortization of certain
intangible assets, imputed interest expense, deferred revenue acquisition
accounting adjustments and non-recurring acquisition related expenses, non-
GAAP revenue for the company's first quarter is expected to be in the range
of $27 million to $28 million and non-GAAP net loss is expected to be
between $0.02 to $0.01 per diluted share. The difference between GAAP and
non-GAAP revenue reflects purchase accounting adjustments related to
deferred revenue write downs. Omniture expects to record positive adjusted
EBITDA in the range of $2.0 million to $2.5 million.
-- Full Year FY 2007: GAAP revenue for the company's full year 2007 is
expected to be in the range of $130 million to $132 million. GAAP net loss
is expected to be in the range of $0.36 to $0.32 per diluted share.
Excluding the effect of stock-based compensation expense, the amortization
of certain intangible assets, imputed interest expense, deferred revenue
acquisition accounting adjustments and non-recurring acquisition related
expenses, non-GAAP revenue for the company's full year 2007 is expected to
be in the range of $134 million to $136 million and non-GAAP net income for
the year is expected to be in the range of $0.03 to $0.05 per diluted
share. The difference between GAAP and non-GAAP revenue reflects purchase
accounting adjustments related to deferred revenue write downs. Omniture
expects to record positive adjusted EBITDA in the range of $16 million to
$18 million. |
