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CMGI Sheds Engage, Navisite

September 17

Months after acquiring SCM vendor Software Logistics Corporation, online investment firm CMGI announced the divestment this week of two of its largest properties Navisite and Engage.

Navisite, a managed hosting company, had been acquired by Clear Blue Technologies, Inc., a manager of a telcom carrier-neutral data centers. In the transaction, CMGI received a minority interest in ClearBlue.

In the Engage sale, a sort of management buyout, CMGI transferred to Engage all of the company's shares held by CMGI (about 75% of the total outstanding), and has cancelled all of the debt owed by Engage to CMGI. In turn, Engage, among other things, paid CMGI $2.5 million in cash, agreed to pay CMGI up to an additional $6 million in the form of a senior note, committed to certain earnout payments, and the company issued warrants to CMGI for CMGI's prospective future purchase of up to 9.9% of Engage's common stock at an exercise price of $4.8 cents per share.

These transactions represent CMGI's continuing campaign of selling currrent IT assets while seeking new IT industry investment opportunities.

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