Compaq Buys Shopping.com for $220 Million

Compaq Computer
Corp.
Monday announced it will acquire e-tailer Shopping.com in what it describes as a
move to leverage user traffic derived from its AltaVista search engine.


Compaq will acquire all of the outstanding shares of Shopping.com for $19
per share in cash, which roughly amounts to $220 million. The board and
management of Shopping.com have unanimously approved the acquisition and
will recommend shareholder acceptance.


According to Compaq, the increased traffic from AltaVista and
Compaq Internet PCs will speed Shopping.com’s reach more effectively than
through a stand alone e-commerce concern. In addition, consumer purchasing
data obtained via Shopping.com will enable AltaVista to organize pertinent
content and information for users based on buyer habits.


Shopping.com offers 2 million name brand products through more than 1,000
merchandising partners. Customers can also earn purchase points through a
rewards program.


Today’s news comes on the heels of last week’s announcement of a management
shake-up, following customers complaints of inaccurate credit card charges,
connection problems and shipping delays.


“The Internet is fast becoming a transaction medium in addition to a
content medium. Today, AltaVista becomes the first site to fully combine
these two capabilities into one synergistic user experience,” said
Rod Schrock, Compaq’s senior vice president and group general manager of
the company’s consumer products unit.


“Our intent is to make AltaVista the leading guide for both information and
e-commerce on the Internet.”


Compaq entered into a stockholder agreement with certain shareholders who
collectively hold a 27 percent in Shopping.com.


For the deal to close, Compaq must receivee at least 90 percent of the
issued and outstanding shares of common stock of Shopping.com.


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