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Art Technology Group Acquires Primus
August 11, 2004

Art Technology Group, Inc., (ATG) announced its intent to acquire Primus Knowledge Solutions, Inc. in an all stock deal valued at approximately $30 million to $33 million, based upon ATG’s closing stock price as of August 9, 2004. For the 12 month period ended June 30, 2004 , the two companies had combined revenue of more than $90 million. Cost synergies between the two companies are expected to result in between $10 million and $15 million in annual savings for ATG, beginning in 2005. The transaction is expected to close during the fourth quarter of 2004.

ATG’s industry-leading software for online commerce and marketing combined with Primus’ award-winning customer service software solutions will create one of the industry’s largest online commerce and service software companies. The combination will produce the most complete consumer-facing platform to work seamlessly through Web, email, call center, and other channels.

The acquisition creates a number of synergies on both the top and bottom line. The opportunity to sell integrated commerce and service solutions into each company’s respective customer base provides ATG with significant revenue growth potential. On the expense side, the combination is expected to generate between $10 million and $15 million in annual savings beginning in 2005, through workforce synergies, facilities consolidation and the merger of accounting, legal and regulatory functions.

Under the terms of the agreement, ATG is acquiring all of the outstanding shares of Primus. Upon completion of the transaction Primus shareholders are expected to own approximately 30 percent to 32 percent of the combined company’s outstanding stock on a fully diluted basis. The transaction is expected to be tax-free to Primus shareholders.

All directors and executive officers of Primus and certain other shareholders, owning in aggregate approximately 14.6% of Primus’ outstanding shares, have signed an agreement to vote their shares in favor of the transaction. Both Primus’ and ATG’s boards of directors have unanimously approved the transaction. The transaction requires the approval of shareholders of both companies. Pending legal and regulatory review and shareholder approval, the transaction is expected to close during the fourth quarter of 2004.

As part of the transaction, ATG anticipates that it will be adding two members to its board of directors, bringing the total to nine board members. It is anticipated that Michael Brochu and Daniel Regis, chairman of Primus’ audit committee, will become members of the board of directors of ATG.

For more info, www.primus.com