SAN FRANCISCO
-- Overture Services has agreed to acquire search technology company AltaVista for $140 million in cash and stock, the companies
announced Tuesday.
Overture offers a service in which companies place bids to have their advertisements displayed among search results at sites
operated by Yahoo, Microsoft's MSN unit and others. Buying AltaVista will help Overture to enhance those commercial services,
the company said in a statement.
Overture also has its eye on the AltaVista Web site, which it will use to test out new search products and marketing services
for its advertisers in a "live" setting, the company said.
Subject to customary approvals and "certain other conditions," the purchase is expected to close in April and be accretive
to Overture's earnings by mid-2004, the company said. The company will pay for AltaVista with Overture common stock currently
valued at $80 million plus $60 million in cash.
AltaVista's search technology uses algorithms to crawl the Web and track down results for end users. The company offers "paid
inclusion" services that ensure that business's Web sites are included in the results. Overture said it plans to enhance those
services.
AltaVista, established in 1995, was a pioneer in Internet search technology. With headquarters in
Palo Alto,
California
, it has about 250 employees worldwide and offers search results in 25 languages. AltaVista is a majority-owned operating
company of CMGI Inc.
The company has faced increased competition from popular upstarts such as Google Inc., and in November it revamped its service
with new search tools for consumers and new marketing opportunities for businesses.
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