It is paying approximately $4m in cash, and company officials told a news conference that CyberBazaar’s founders would also get incentives linked to milestones and performance targets. The acquisition is expected to close in the first quarter of 2004.
Under the deal, Bangalore-headquartered CyberBazaar would become a 100% subsidiary of WebEx, with CyberBazaar continuing to maintain its India offices and management team. It has about 120 employees and 500 customers, with an estimated 80% market share in India. For the year ending September 30, 2003, it reported revenue of $2.7m, with a pre-tax profit margin of 30%. It currently has cash of about $1m.
The acquisition will enable WebEx to provide multimedia web communications for India’s fast-growing service sector, enhancing communication between businesses in the region and their international customers, the two companies said in a statement. CyberBazaar was chosen because it was a conferencing service leader in India, had a proven management team, and a strong customer base.
San Jose, California-based WebEx is also thought to be examining the possibility of using India as a technology support base to help its global customers.
WebEx controls nearly 65% of the global market in conferencing services. The arrival of broadband is thought to have helped push its revenue from $2m in 1999, to $140m in 2002, and an estimated $185m to $190m in 2003.
This article is based on material originally produced by ComputerWire.
