FindWhat, Espotting merge paid search listing services

European paid listing service Espotting Media is being bought by U.S.-based FindWhat.com. for $163 million.

The merging companies are complementary, offering similar services in different geographic marketplaces, Espotting Marketing Director Chrys Philalithes said Thursday.

The companies run on an auction basis, with a 24 hour, 7-day-a-week service allowing advertisers to bid a higher price at any time to boost their names to the top of a keyword listing, Philalithes said.

Paid listing services are most useful when people want to buy a specific product, Philalithes said. “If you’re doing research, go to Google, but if you want to buy goods, come to Espotting. [The listings are] country-specific and we have an editorial team that checks every listing for relevance,” she said.

Espotting of London was set up in February 2000 and launched its U.K. service in September of that year. It now operates in the U.K., France, Germany, Spain, Italy, Sweden, Denmark, Norway, Ireland, and Switzerland.

As well as running its own site, the company works with portals including Yahoo and Lycos to provide paid-for listings under key words, Philalithes said.

FindWhat.com was formed in March 1998 and became a publicly traded company in June 1999. Since then, its revenue has grown from $450,000 to more than $42 million in 2002, it said in a statement about the merger.

Espotting deals with over 850 million queries a month and that number will rise to 2.25 billion when it combines with FindWhat.com, of Fort Myers, Fla., Philalithes said. It currently has over 16,000 clients in Europe, she said.

The combined business will have 40,000 advertisers and is expected to have a revenue of $140 million in 2003, FindWhat said in its statement.

FindWhat predicts a 30 percent to 40 percent revenue growth and 40 percent to 50 percent pretax income growth in 2004, due to opportunities in the markets of both companies and the benefits of the merged operation, it said.

No decision has yet been made on whether the Espotting name will be retained, Philalithes said.

Espotting’s stockholders will receive about 8.1 million shares of FindWhat.com common stock and about $27 million in cash, Espotting said in its own statement.

The merger is expected to be complete by the end of the year, Espotting said.

FindWhat.com was not immediately available for comment.