Kana Communications, Broadbase Software to Merge

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Enterprise relationship management software provider Kana Communications Inc. plans to merge with Broadbase Software Inc. and create a new company called Kana Software, the firms said yesterday.


Under terms of the agreement, shareholders of Broadbase Software's stock will receive 1.05 shares of Kana Communications stock for each Broadbase share they own. Financial terms of the deal were not disclosed. The deal is expected to close in the third quarter.


Kana Communications, Redwood City, CA, has 875 employees. Broadbase Software, Menlo Park, CA, has 600 employees. Both companies expect to eliminate some positions but would not specify how many.


"This combination positions us as a leader in the eCRM space," said Walt Rossi, vice president of field marketing at Broadbase Software. "We now have combined offerings from sales, marketing and customer service."


Rossi noted that the new company will take advantage of opportunities to cross-sell to its combined 1,300 clients. The new company expects to compete head on with E.piphany in the customer relationship market, he said.


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