Online directory Scoot.com has acquired UK classified advertising company Loot to increase its profile as a UK retail website.
Scoot will pay £178m in cash and five million Scoot shares for Loot, in a deal funded through the sale of Scoot shares to French communications company Vivendi. Vivendi's stake in Scoot will increase to 22.4 per cent as a result of the deal.
The combined Scoot and Loot business will offer business directory, classifieds and entertainment services. It will use several distribution channels, including interactive TV and wireless internet.
Jon Molyneux, chief executive at Scoot UK, said: "The combined business will provide customers with a 'one-stop shop', offering a broad range of services from any device possible - the Wap phone, the PC, the TV."
Scoot plans to offer its business customers opportunities to advertise services alongside items sold by Loot. "If a consumer wants to find a flat in London, for example, they could find it using Loot's service and then find a removal firm to help with the move via Scoot's service," said Molyneux.
The strong Scoot and Loot brands will remain intact, but the websites will be integrated within a few weeks, he added.
The joint venture, which is expected to generate £20m of incremental high-margin revenue within three years of the acquisition, will generate additional growth opportunities "over and above the existing rapidly growing Scoot model", the companies said.
Scoot operates in the UK, the Netherlands and Belgium, and plans to roll out its service across Europe over the next three years, in a joint venture with Vivendi.
Scoot also revealed today that its pre-tax losses had increased from £10.2m last year to £10.5m. But operating losses were down by 11 per cent from £11.1m to £9.9m.
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