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Beyond.com Acquires Buydirect.com

Two of the largest software e-tailers joined forces Monday with Internet superstore Beyond.com acquiring BUYDIRECT.COM in a stock deal worth approximately $133.65 million.

Beyond.com will issue 5.4 million common shares to finance the deal. Both companies' board of directors have approved the transaction which is expected to close by the end of March.

The companies expect big benefits from the deal, due in large part to Beyond.com's e-tailing partnerships with @Home Network and XOOM.COM.

"This acquisition solidifies Beyond.com as the world leader in software resale over the Internet," said Mark Breier, Beyond.com's president and chief executive officer.

"Together, we now boast nearly 1 million cumulative customers, a deep management team, a talented pool of experienced engineers, leading proprietary digital download technology and one of the most complete lists of portal, content and broadband partnerships in the industry."

Beyond.com also plans to leverage the resources of BUYDIRECT.COM's content providers, which include CNET and ZDNet. Recently BUYDIRECT.COM singed with ZDNet to become the main online software retailer across that company's network of sites. That agreement also calls for BUYDIRECT.COM to receive major promotional opportunities throughout the ZDNet site.

Beyond.com's also recently became the premier software merchant on Yahoo! and has also sealed partnerships with America Online, Excite, and Netscape. In addition Beyond.com has partnerships with software publishers Autodesk, Microsoft, Network Associates and Netscape to fulfill their online software orders.

Beyond.com will gain a strong customer base in the small office/home office market sector, adding to Beyond.com's customers in the consumer, government agency and enterprise markets. The acquisition also gives Beyond.com more than 200,000 new customers from BUYDIRECT.COM, and new services including downloadable software tutorials.

"In our view, our combined companies simply can't be beat in branding, distribution partners, content and technical expertise," said Bong Suh, BUYDIRECT.COM's chief executive officer.

"When considering the excellent product fit, complementary marketing and distribution channels, and the strong cultural match between our two companies, we believe this acquisition benefits our collective customers, publishers, employees and stockholders,'" Suh said.

Beyond.com said it does not expect to layoff any employees. Mark Breier will retain his title as Beyond.com's president and chief executive officer. Bong Suh, chief executive officer of BUYDIRECT.COM, is to become vice president of corporate development for Beyond.com, developing additional large-scale partnerships.



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