|June 2, 2005
eBay buys Shopping.com for $620 million cash
|The deal represents a 21% premium over Shopping.com's share price. It is expected to close in the third quarter.
|Online auction site eBay (EBAY) reported last night that it was buying Israeli online comparison shopping company Shopping.com (Nasdaq: SHOP).
eBay will acquire all outstanding shares of Shopping.com stock for $21 per share in cash. On the basis of the number of Shopping.com shares outstanding on May 31, 2005, the total consideration will amount to approximately $620 million. This compares with a market cap for Shopping.com at the opening of trading yesterday of $520 million. Shopping.com's cash, cash equivalents, and marketable securities as of May 31, 2005 totaled approximately $140 million.
The acquisition is subject to regulatory and Shopping.com shareholder approvals. It is expected to close in the third quarter of 2005.
Shopping.com (formerly Dealtime) was founded in 1997 with initial finance from Israel Seed Partners. Last October, the company was floated on Nasdaq at a value of $500 million. After the flotation, the share price shot up to give the company a market cap of some $1 billion.