On Monday, Goto.com announced a deal to buy privately-held Cadabra for $8m cash and $242m (£145m) in stock, or almost 2.36 million shares at Monday's closing price. Goto.com had a market cap of about $.8bn as of Monday's close.
Cadabra's product search and comparison technology will be integrated into Goto.com's website, which features a search engine in which clients pay for higher rankings in search listings.
"Cadabra is a logical evolution for our search marketplace," Goto.com CEO Jeffrey Brewer said. "Together we will be able to provide a more comprehensive and more valuable matching of buyers and sellers within our targeted, pay-for-performance model."
Executives from both companies portrayed the combination as a way for advertisers to improve customer targeting, and for shoppers to obtain better results from Web searches.
Shares of Goto.com shot up earlier this month after a federal court issued an injunction barring Go Network from using a logo similar to Goto.com's, but the latter's stock fell last week after a subsequent ruling that stayed the injunction pending an appeal. Goto.com closed Monday at 106 1/8, down 2 1/8.
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