CEO Declan French says the all-stock transaction with ObjectArts, which requires shareholders' approval, will let the IT recruiting and consulting company be more objective when it advises on personnel investments for meeting staffing needs. Often, the best answer is inside the company--not hiring a new employee, he says. "If you have good employees who don't have quite the right skills but are good people, it's worth $10,000 or $12,000 to get them trained," French says.

The companies already share some clients, including brokerage firms Goldman Sachs Group Inc. and Merrill Lynch & Co. ObjectArts CEO Marilyn Sinclair says she was looking for a partner that could complement her company's services.

"When you look at staffing, consulting, and training, those are the three methods clients use to fill their skills gap," Sinclair says.

Jim Ayube, an analyst who covers the training industry for Aberdeen Group, says he hasn't heard of similar acquisitions, but it makes sense for recruitment firms to provide training for their clients. "It sounds like a natural extension of what they're already doing," he says.

IT Staffing plans to continue expanding its product offerings through acquisitions, French says. The company is negotiating with companies in consulting and training in California, he says. IT Staffing, which is listed on the Nasdaq, had about $60 million in revenue last year, about half of which was in the United States and half in Canada.

The company is also selling a hosted Web application for managing the IT workforce, starting at $1,200 a month for the first two IT managers. Its client list includes AT&T Canada.

French says IT Staffing's diversification doesn't mark a retreat from the hypercompetitive recruitment business. He says decisions about staffing, training, and human-resources management are done by the same people, so it's an opportunity to sell a broader product line to those people using one sales force.

"We're not suggesting there is anything wrong with the recruitment business," he says. "We want to grow them together."