SAN FRANCISCO (03/10/2000) - Online "pay for placement" search engine GoTo.com Inc. said Thursday that it will acquire AuctionRover.com, an online swap portal for buyers and sellers, for $165.8 million in GoTo stock. GoTo plans to integrate listings of online auction items and Web sites under its layout once the deal is finalized.
GoTo sells priority search-engine listings to Web sites and e-commerce retailers. Buyers bid for better placement through an ongoing auction and pay only when GoTo users click through a listing. After the acquisition is complete, the search engine will sell placement of online auction items, as well. GoTo will hand over 3.47 million shares to the private AuctionRover.
Thursday, GoTo shares fell 2.63, or 5.2 percent, to close at 47.88. Visitors to the AuctionRover site can search for and bid on auction items from more than 50 Web sites. Sellers can use the auction site to place ads and manage their inventories across many sites. GoTo founder and CEO Jeffrey Brewer said combined listings of auctions and e-commerce sales makes his site much more profitable and usable than traditional search engines.
"We think it's a mistake to ghettoize search listings from shopping and auctions," Brewer says. "Ours is a business-to-consumer auction model, and that's where all the money is today." Internet advertising holding company CMGI said on Feb. 10 that it would acquire consumer-product auction site uBid.com for $407 million in stock. UBid.com, which had revenues of $205 million in 1999, sells consumer products to customers through auctions conducted on the company's Web site. Product lines include computers, electronics, sporting goods, jewelry and travel.
UBid owns a sister auction site for industrial and manufacturing equipment.