Contextual targeting technology provider Crystal Reference Systems has been acquired by European marketing services provider Ad Pepper Media in a cash and stock deal worth up to $3.5 million, and will become a wholly owned subsidiary of Ad Pepper,reports ClickZ. Crystal unit Crystal Semantics uses statistical algorithms and linguistic tools (which it terms Textonomy) to bring contextual relevance to ads targeted on a web page, analyzing all the words on a web page - not just keywords - to figure out its context and meaning.

"We envisage that Ad Pepper's infrastructure, resources and global positioning will enable us to leverage the full power of our product solutions and will help us to roll out new services and business models faster," Crystal Reference Systems chairman David Crystal said in a statement.

Crystal had agreed to sell a controlling stake in the company to Think Partnership, but the deal did not go through. The sides "failed to agree upon mutually acceptable definitive agreements," Think CEO Gerard M. Jacobs is quoted as saying.

Ad Pepper, based in the Netherlands and Germany, plans to immediately implement Crystal Semantics' Textonomy solution across its Webstats4u global advertising network of over 1,000,000 websites.

Also today, Ad Pepper Media announced that it would sell its 25.1 percent share in Falk eSolutions, which is being acquired by DoubleClick, and would migrate to DoubleClick's DART for Publishers.