EBay buys Shopping.com for $620 million
EBay Inc. has continued its acquisition spree by agreeing to buy comparison shopping site Shopping.com Inc. for about US$620 million in cash, the companies said Wednesday.
The move should benefit eBay's sellers by giving them access to a new sales channel and a new set of buyers, while Shopping.com will be improved by the addition of eBay's listings on its site, the companies said.
EBay is much larger than Shopping.com: It had annual revenue of $3.3 billion in 2004, and net income of $778.2 million. In the same year, Shopping.com made $99 million in revenue and net income of $12.2 million.
But Shopping.com has been adding customers at a faster clip, according to research company comScore Media Metrix. It attracted 22.6 million unique visitors in April, up 15 percent from the same month a year earlier, compared with 63.8 million for eBay, an increase of 6 percent over the same period.
EBay will pay $21 per share for all the outstanding shares of Shopping.com, the companies said. The deal will reduce eBay's earnings per share for 2005 on the basis of generally accepted accounting principles, due to stock compensation charges and other factors.
The acquisition is expected to close in the third quarter, subject to the approval of regulators and Shopping.com shareholders.
The move continues something of a buying spree for eBay, which has been looking to grow its business and expand into new areas.
In December it agreed to buy property listings site Rent.com Inc. for $415 million, and a month before that it bought Holland's top classifieds site, Marktplaats.nl, for $290 million. Earlier last year it acquired a 25-percent stake in Craigslist of San Francisco, beefing up its classifieds business.