CMGI cuts ties with past, sells NaviSite
ClearBlue has acquired HP Financial Services' 3.2 million NaviSite shares and $55m convertible debt position and CMGI's 76% equity and $10m convertible note in NaviSite, giving it 79% of NaviSite's equity. If it were to convert the notes being acquired it would own 94% equity. In exchange, HPFS and CMGI get to share a 24% stake in ClearBlue.
Having spent the large part of the dot-com years acquiring technology firms, struggling CMGI is now fine-tuning its strategy on what it sees as core assets. Last month it closed the acquisition of iLogistix (Software Logistics Corporation), as part of its effort to beef up its e-business and fulfillment segment.
ClearBlue, a holding company with its roots in Israel, has also been vulturing for bargains this year, snapping up the European assets of bankrupt PSINet Inc six months ago and bankrupt AppliedTheory Corp in June in an effort to build out hosting and internet connectivity business in the US and Europe.
NaviSite's loss of $2.million in the third quarter to April 30 contributed to CMGI's overall loss of $125.2m, but with the divestiture, future losses will not count against CMGI's numbers. CMGI still owns five companies that are not in its e-business and fulfillment segment, including AltaVista Co, YesMail and Equilibrium.