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eBay to buy for $620m cash

Online auctioneer eBay Inc. on Wednesday it agreed to buy, which provides online comparison shopping and consumer reviews, for about $620 million in cash.

The move by eBay will strengthen its hand in being able to bring consumers online comparison shopping, something that Internet search engine Google has dabbled in with its Froogle service, along with other Internet companies.

EBay's once torrid growth has slowed in recent quarters as its U.S. market has begun to saturate and its growth in emerging markets, such as China, has yet to take off. In April, eBay's quarterly net profit rose 28 percent but it forecast future profits at or below Wall Street estimates.

The auctioneer of everything from classic cars to Pez candy dispensers has been dogged by growth concerns since its fourth-quarter results showed moderating revenue acceleration in key markets such as the United States and Germany.

California-based eBay said it agreed to buy for $21 per share in cash.'s cash, cash equivalents and marketable securities as of May 31, 2005, were about $140 million, eBay said.

The $21 price represents a 20 percent premium to's closing price of $17.44 on Wednesday on Nasdaq, where it rose 37 cents, or 2.2 percent. In after-hours trade, rose 20 percent to $20.90 on Inet. has not been a publicly traded company for long. It had its initial public offering in October 2004 at $18 per share.

Last month, the company posted a higher first-quarter profit on what it said was a stronger U.S. business and its launch in France. Net income rose to $3.9 million, or 12 cents a share, from $2.2 million, or 9 cents a share. Revenue rose 38 percent to $28.9 million.

EBay said it expected the planned acquisition to be immaterial to its 2005 earnings per share before items and to lower its 2005 net earnings per share because of charges for stock-based compensation and the amortisation of certain acquired assets.

The purchase also gives eBay's sellers a new sales channel and access to a new set of buyers. also has more than 400,000 so-called Epinion reviewers that eBay said would complement its own community-feedback-based marketplace.

There is already good overlap between the two companies' Web sites. In April, 22 percent of eBay visitors also visited sites, according to comScore Media Metrix, and 61 percent of sites visitors also visited eBay in April.

Some 13.8 million consumers visited both eBay and sites in April, and on a combined basis, the two sites reached 71 million consumers in the month, according to comScore Media Metrix.

EBay said that the transaction, which is subject to regulatory and shareholder approval, is expected to close in the third quarter. employs 200 full-time employees and 110 part-time employees and there are "no plans to dramatically change that team," said eBay spokesman Hani Durzy when asked about potential layoffs at

Shares of eBay rose $1.11, or 2.9 percent, to close at $39.11 on Nasdaq. In after-hours trade on Inet, the stock slipped to $38.78, a decline of less than 1 percent.

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