InfoSpace.com announced today that it has signed an agreement to purchase INEX Corporation, a Toronto, Canada-based company that provides solutions for merchants to build, manage and promote online stores. This deal will allow InfoSpace.com to offer its affiliates tools to build e-commerce businesses.
Internet infrastructure company InfoSpace.com (Nasdaq: INSP) has established its customer base largely by offering services to help its affiliates build content and community. Now, the company is concentrating on ways its affiliates can create e-commerce presences. “We are seeing rapid growth in the online commerce area and we’ve had tremendous demand among businesses of all sizes to establish online stores and obtain distribution through our affiliate network,” said Naveen Jain, chairman and CEO of InfoSpace.com.
Under the terms of the deal, InfoSpace.com will exchange 900,000 shares of common stock in exchange for 100 percent of INEX. At InfoSpace.com’s Friday closing price of 41/3/4, the deal is worth more than $37.5 million. The acquisition is expected to close in September.
The deal is the latest e-commerce move by InfoSpace.com, which recently launched ActiveShopper, its first e-commerce service. ActiveShopper gives customers the ability to research and buy products online and obtain special product promotions. ActiveShopper is now being used on more than 700 Web sites.
ezStore Will Become InfoSpace.com StoreBuilder
InfoSpace.com will relaunch INEX’s ezStore service, a browser-based storefront building solution, as InfoSpace.com StoreBuilder. The StoreBuilder service will offer setup, design, hosting and promotional services for online stores.
Jain says that InfoSpace.com “will integrate these online stores with our other services such as ActiveShopper, white pages, yellow pages and classifieds, giving our affiliates and local merchants the ability to be every place a buyer and seller can meet on the Web.”
In addition, InfoSpace.com will continue to offer and support INEX’s catalog of e-commerce applications. InfoSpace.com will also integrate INEX’s ezPage application into its service. This application enables local merchants to build a home page describing their business and link it to a yellow page online storefront.
InfoSpace.com says its affiliate network reaches more than 85 percent of all Internet users. This network includes more than 1,800 affiliates, including America Online, Netscape, Microsoft and Lycos.
On July 27, InfoSpace.com reported record revenues of $6.73 million for the second quarter of 1999, a 266 percent increase from the $1.84 million reported in the second quarter of 1998. The company also reported that traffic on its affiliate network grew to 1.4 billion page views for the second quarter of 1999, a 273 percent increase from the 375 million reported for the same period last year.