updated after reaching CEO Russ Fradin and Cox Chief Financial Officer John Dyer

Adify, whose software helps companies build their own advertising networks, has been acquired by media company Cox Enterprises for $300 million, according to various sources.

We’ve since confirmed the acquisition with CEO Russ Fradin (see his own blog post here).

The San Bruno, Calif. startup had raised around $27 million in total funding, with backers including U.S. Venture Partners, Venrock Associates, GE Commercial Finance, NBC Universal, and Time Warner Investments.

Adify has built many vertical ad networks and its client list that includes the Guardian, Forbes.com and NBC WeatherPlus. Some speculate that Adify was a strategic acquisition target for Cox, which is a private but giant media company that owns Cox Newspapers (with related websites) and Cox Networks, the third-largest cable company in the United States.

However, Fradin downplayed the strategic nature of the deal, instead saying it was just the latest move by Cox to enter a high-growth media business, something it has done consistently over the years. Cox started as a newspaper company, but then diversified with each new innovation, moving to radio, TV and eventually online, building Autotrader, for example, cannibalizing its own existing classifieds business. Cox Chief FInancial Officer John Dyer also told us Cox’s media properties could use some help to build their own ad networks, but he said the main reason for the deal was Cox executives’ belief that Adify’s business will continue to grow.

The price tag must have made Adify executives and investors pretty happy. PaidContent reports (and we’ve since confirmed) that the company brought in $7 million in revenue in 2007 and was set to bring in around $35 million this year. Adify launched in 2006 and was founded by Larry Braitman and Richard Thompson, the team that also created Flycast Communications a decade earlier.

The company has built 108 ad networks, Fradin said.

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