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Friday, 18 August, 2000, 07:00 GMT 08:00 UK
Online auctioneer knocks down price

UK web auctioneer QXL has negotiated a lower price for the takeover of its German rival Ricardo.

A week ago the merger had been thrown into doubt after QXL said it was evaluating "certain information" provided by Ricardo.


QXL now says its German partner expects revenue and gross auction value during April to June this year to fall by about 20%, compared to the first quarter of the year.

QXL's chief executive Jim Rose said he still believed the merger with Ricardo would create a "strong and competitive" business platform from which to achieve the strategic and financial goals of both companies.

The combined firm will be called QXL ricardo. It will be Europe's largest auction web site with more than two million registered users.

Lost fortunes


The British web company will now offer 34 of its shares for each Ricardo share, down from the original offer of 42.6 shares.

This is a premium of about 11% over Ricardo's closing share price on 17 August.

When the merger was originally proposed, Ricardo was valued at about 1.1bn euros (666m). Three months on, the company is worth a mere 282.8m euros (171.2m).

Both companies have seen their share prices plummet during recent months, as investors began to worry about the profit prospects of internet ventures.

QXL shares have dropped from more than 800 pence to just under 60 pence.

Ricardo is currently trading at just under 30 euros, down from a year high of 222 euros.

The drop in Ricardo's business fortunes is the result of a plan to boost profitabilty. The web site introduced commission charges, which scared away many sellers.

The take-over of Ricardo.de was meant to strengthen QXL's position as Europe's leading auction web site, putting it clearly ahead of US rival eBay.

The firm currently operates in 13 European countries.

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See also:

10 Aug 00 | Business
QXL, Ricardo online merger in doubt
31 May 00 | Business
QXL upbeat despite losses
16 May 00 | Business
QXL in German merger
08 Feb 00 | Business
Losses leap at QXL
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