Yahoo sells off comparison shopping arm Kelkoo

Yahoo has sold the comparison shopping engine Kelkoo for which it paid EUR475 million in 2004.

Yahoo has sold Kelkoo, the European comparison shopping service it bought in 2004 -- at a time when Microsoft is busy adding such features to its own search offering. The sale, to U.K. company Jamplant, is the first sign since CEO Jerry Yang stepped down last Monday that Yahoo is refocusing.

The deal was sealed on Friday, according to a spokeswoman for Yahoo. She would not say what price Jamplant paid for Kelkoo.

However, Kelkoo founder and former CEO Pierre Chappaz offered an unflattering price comparison in his blog: He said that Kelkoo sold for under EUR100 million (AUDS$198 million), far less than the EUR475 million Yahoo paid for it in March 2004.

The buyer, Jamplant, is a U.K. company created only six weeks ago. Its corporate registration does not list its officers, shareholders or contact details, and Yahoo declined to provide further details.

The divestiture of Kelkoo -- a business Yahoo described Monday as "non-strategic" -- is yet another sign that Yahoo sees the market differently than search rival Microsoft, which in August bolstered its search operations with the acquisition of a European comparison shopping service, Ciao, for $486 million.

Microsoft hopes to use Ciao's comparison shopping features to boost its Live Search offering, which has been steadily losing market share to Google.

Other strategies Microsoft has tried include Live Search Cashback, which pays visitors to use its search engine by offering them rebates on products bought from its search listings.

That's a trick Kelkoo has copied under Yahoo's ownership, with the launch last week of a beta version of Kelkoo Cashback, a program which offers users of Kelkoo's U.K. site rebates of up to 25 percent on purchases made through Kelkoo comparison engine.

Microsoft and Yahoo however have been heading in opposite directions since February, when Yahoo turned down a $45 billion acquisition offer from Microsoft. More recently Yahoo has been asking Microsoft to come back to the negotiating table, but to no avail.

Links to the "Shopping" section of Yahoo's European properties still lead to Kelkoo's price comparison sites on Monday, and those sites still carried the tag "a Yahoo! company." Ciao's sites, on the other hand, are not yet bragging about the company's links to Microsoft.

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Peter Sayer

IDG News Service
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