Internet professional services firm USWeb/CKS (Nasdaq: USWB) and e-business solutions provider Whittman-Hart (Nasdaq: WHIT) announced today that they will merge to create one of the largest pure-play Internet professional services company in the world.
The San Francisco-based USWeb/CKS and the Chicago, Illinois-based Whittman-Hart will merge in a stock-for-stock transaction, the companies said.
Once the deal meets shareholder and regulatory approval, USWeb shareholders will own 57 percent of the new company, while Whittman-Hart shareholders will own the remaining 43 percent.
Combined, the two companies will have a market capitalization of approximately $14 billion (US$), based on current prices.
New Company Still Unnamed
Whittman-Hart CEO Robert Bernard will take the helm as CEO of the new company, while USWeb CEO Robert Shaw will become chairman. The companies did not disclose a proposed name for the new company, which will have its headquarters in Chicago.
“We realize that executives today face new challenges as a result of the Internet’s deep impact on business, and their companies are likely to face a series of investments and divestments that will transform their business models,” said Shaw.
“The merging of our strategy and technology disciplines will accelerate the creativity and innovation we bring to companies embracing the digital economy.”
The new company will continue to target the sectors that have brought the partners this far, helping established brands develop a market on the Internet, helping build start up online ventures, and helping brick-and-mortar businesses build an Internet model.
About the Companies
USWeb, the more well-known of the two companies, has 4,000 employees and offices in 13 countries. The company booked third-quarter revenues of $138.9 million and reported a net loss of $27.8 million for the quarter.
Whittman-Hart has 3,900 employees in 23 branch offices throughout the United States and the United Kingdom. It booked third quarter revenues of $121.2 million and a net income of $9.2 million.
Whittman-Hart has been in business since 1984. Forbes Magazine named it as one of the 200 Best Small Companies in America in both 1997 and 1998. The company recently received a $100 million investment from Novell to help speed up the deployment of Novell Directory Services to its client base.