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ShopNow.com Acquires Freemerchant.com for $34 Million

E-commerce enabling company ShopNow.com Inc. acquired Freemerchant.com, an e-commerce technology and application service provider serving small and medium size businesses, in a $34 million deal.

ShopNow.com said that as a result it will add the Freemerchant Network of more than 65,000 businesses to its b2bNow Network of over 600,000 businesses, the ShopNow Network of over 50,000 merchants and the BottomDollar Network of over 2,400 commerce-enabled sites.

ShopNow.com will integrate Freemerchant's commerce technology into its existing networks, adding to its e-commerce enabling services.

The company said it will continue to license the Freemerchant business store builder technology and commerce services to businesses, community sites, commerce sites and other third party e-commerce providers.

The deal involves $32 million in ShopNow.com common stock and $2 million in cash. ShopNow.com intends to move Freemerchant.com's operations from Emeryville, CA, to its San Francisco office and retain all employees.

" by growing our commerce networks we anticipate an expansion in revenues from the increased number of e-commerce transactions we process and an increase in the number of licensed e-commerce enabled partners on our networks," said Dwayne Walker, chairman and chief executive officer of ShopNow.com (SPNW).

Freemerchant.com's free solutions include a business or merchant store builder, store hosting, a secure shopping cart and a product catalog.

Launched in December 1998, Freemerchant.com generates revenue by offering the goods and services of its partners at a discount, for a commission, and by splitting ad revenue with member stores.