Digital River Acquires Customer Assets of FreeMerchant.com from Network Commerce
Further extends e-commerce outsourcing model to small to mid-sized enterprise market
MINNEAPOLIS, MN, January 4, 2002--Digital River, Inc. (NASDAQ: DRIV), a leading global e-commerce outsource provider, today announced that it has acquired the customer assets of FreeMerchant.com from Network Commerce, Inc. (OTC BB: NWKC), in exchange for $875,000 in cash. The acquisition, which is expected to be immediately accretive, supports Digital River`s previously announced acquisition strategy, reinforces the company`s e-commerce leadership position and further extends its market potential in the small to mid-sized enterprise (SME) market.
"This acquisition is an extension of our plan to further leverage our e-commerce system to support a growing base of SME sites in our E-Business Services Division," said Joel Ronning, Digital River`s CEO. "We are committed to providing Network Commerce`s clients superior e-commerce outsourcing products and services through our world-class infrastructure, which now supports a client base of over 13,000 companies ranging in size from small businesses to large enterprises."
Under the terms of the agreement, Digital River acquired approximately 3,000 subscription-based customers from Network Commerce`s FreeMerchant.com business in exchange for $875,000 in cash. The agreement does not include the acquisition of any Network Commerce personnel. In addition to the cash payment, the agreement provides Network Commerce an opportunity for an additional earn out based upon revenue generated from the acquired customer assets over the next ten months. Digital River`s acquisition of Network Commerce`s FreeMerchant.com assets marks the company`s ninth acquisition in the past three years.
About Digital River
Founded in 1994, Digital River is a leading global e-commerce outsource provider, offering more than 13,000 companies complete e-commerce systems and services. The company`s world-class infrastructure and professional services are proven to grow businesses quickly and profitably while reducing risk. Digital River`s commerce services include e-commerce strategy, site development and hosting, order and transaction management, system integration, product fulfillment and returns, e-marketing and customer service. Digital River`s clients include Symantec, Fujitsu, 3M, Siemens, Polaris, Major League Baseball, Novell, Autodesk, SONICblue, Adaptec and Staples.com. For more details about Digital River, visit the corporate Web site at www.digitalriver.com or call 952-253-1234.
Digital River is a registered trademark of Digital River, Inc. All other products or company names mentioned are used for identification purposes only, and may be trademarks of their respective owners
Except for the historical information contained herein, this press release contains forward-looking statements, including statements containing the words "believes," "anticipates," "expects" and similar words. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company, or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others: the company`s limited operating history and variability of operating results; competition in the electronic commerce market; and other risk factors referenced in the company`s public filings with the Securities and Exchange Commission.
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