Adify, the white-label online ad network, has been sold to an unlikely buyer, Cox Communications Enterprises, for about $300 million and earn out, we have learned and confirmed from sources. The San Bruno, CA based startup was out looking for funding, and had been getting some offers on the acquisition and decided to go with them. Investors in the company included Peacock Equity, the venture investment arm of NBC Universal (NYSE: GE), US Venture Partners, Venrock Associates and Time Warner (NYSE: TWX) Investments...it had raised a total of $27 million in funding in two rounds.

Adify is a self-service ad network for other companies interested in developing their own ad network. The service allows a publisher to negotiate ad rates, and to reject an advertiser if wanted, with Adify taking in about 20 percent of the revenues in. Clients include Guardian, Forbes.com, NBC WeatherPlus, Martha Stewart Living Omnimedia (NYSE: MSO) and others.

For Cox, the strategic fit is a bit of a stretch on the online side...it does have Cox Newspapers’ online presence, and it is part of the upstart newspaper ad alliance quadrantOne. But on the cable ad services side, it has been among the early movers into digital and VOD advertising, and could be a fit there. It is also one of the founding cable partners of the ambitious national cable ad network Project Canoe.

Staci adds: This was Peacock’s first investment ... the GE-NBCU fund put the first $3 million of its then-$250 million investment fund into Adify, part of the ad company’s $19 million second round last year, and at this sale price, should have made a nice bit of change. As for Cox, long an advocate of targeted advertising, the company can well afford an acquisition like this—particularly if it can find a way to blend the niche ad net power with its digital cable products while it continues to make money from third party. Then there is the tantalizing thought of how this could fit in with Project Canoe ...

More updates: According to our sources, Adify made about $7 million in revenues in 2007, and is on track to do around $35 million this year. By any standards, it is a very rich deal. Then, a juicy bit for the bankers: Adify did the deal without any banking representation hired JP Morgan after Cox approached the company. CEO Russell Fradin and COO/CFO did the deal themselves.

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