Siebel, the dominant player in customer relationship management (CRM), is buying OnTarget, an Atlanta-based provider of consulting services and training, for $259 million in stock.

Siebel said that by combining OnTarget's consulting and training services with Siebel's front office applications, it will offer a more integrated front office solution, including strategy, methodologies and penetration.

Thomas Siebel, chairman and CEO, Siebel Systems, said: "Our target markets are identical, our cultures are well aligned, and our ability to provide customers with a complete front office solution is tremendously enhanced."

Martin Brampton, chief analyst for Bloor Research, said: "The acquisition plays to Siebel's strengths in sales force automation, but CRM isn't a homogenous market. Siebel isn't strong in call centres, although they have been buying into call centre companies. This move complements what it does well."

OnTarget will operate as a subsidiary in Atlanta, and continue to offer training and consulting services to Siebel's competitors, such as SAP and Oracle. However, it will stop independently developing its sales and training software and develop the software with Siebel, licensing the technology to other firms that provide CRM services.

Siebel said it would issue about 3.7 million additional shares to OnTarget shareholders, who will receive 0.3078 Siebel share for one OnTarget share.