RealTime IT News

Terra Buys into Latin American Auction Site

Terra Networks S.A. Monday inked a deal with Latin American online auctioneer DeRemate.com which will land Terra a 30 percent stake in the company.

Under the terms of the deal, the 5-month-old DeRemate.com and Terra (TRRA), which itself was recently spun off from Latin American telco heavyweight Telefonica S.A.., will jointly produce auction portals in each of the regions where Terra now operates.

Terra currently provides Internet access services in Spain, Brazil, Mexico, Chile, Peru, Guatemala and the United States and operates Internet portals serving those countries and Argentina. Terra plans to launch new portals in other Latin American countries.

Financial terms of the agreement were not disclosed.

DeRemate.com claims to be the first online auction site in Latin America. In 150 days, company acquired Brazilian auction company E-Bazar, raised US$ 12 million in capital from Merrill Lynch, E-Quest, Newbridge and SLI, and launched operations in Mexico, Venezuela, Uruguay, Chile and Colombia. DeRemate has also inked deals with StarMedia and Compaq. In its short lifetime, it has also moved from its origins in Argentina to the U.S.

Terra shows no sign of stopping the flurry of activity which began in January. It made waves last month by diving into the free ISP fray in Brazil with Terra Livre. Two weeks ago, the company formed a venture with Banco Bilbao Vizcaya Argentaria, S.A. to create the first Spanish-language online bank. Uno-e will commence operations in Spain, expanding to Southern Europe and Latin America later this year.

The Spanish Internet player has also formed an alliance with parent company Telefonica for wireless Internet services. Telefonica Moviles, with nine million clients, is Spain's leading mobile phone operator. Terra last week joined the IBEX-35, Spain's major stock index.

Adding to the tumultuous month, Terra's Chief Executive Officer Juan Perea and Director General Jose Antonio Sanchez both stepped down, and Perea will be replaced by a Telefonica executive from a separate unit, according to a Reuters report.