Yahoo’s Kelkoo which is a site that allows online shoppers to choose the lowest price of products and services has been sold to UK-based equity firm Jamplant Limited for a price of $126 million.
Acquired by the Internet giant in March 2004 for $579 million, the Paris-based website was first seen by the company to reinforce its operation in the European region. But with its declining advertising revenue which had forced Yahoo to lay off almost 15 percent of its employees, selling this online comparison shopping service may prove to be a good strategy as its way to cut costs during this period of economic slowdown.
While Yahoo has lost $470 million with the sale of Kelkoo, resorting to this contingency plan is a good decision since the site has not made any progress during the four years of its ownership.
Kelkoo’s Founder and former CEO Pierre Chappaz has expressed on his blogs his sentiments on Yahoo’s failure to help his online shopping site to grow and blamed the Internet giant’s incompetence which had led to his company’s downfall. He also added that Yahoo has failed to provide help to bolster transaction services which may have prevented all this from happening.
According to some experts, Yahoo has failed to tap the lucrative European market where key players including Google (GOOG) and Microsoft (MSFT) are enjoying popularity among Internet consumers.
Yahoo has been to a lot of controversy for the past couple of months. After experiencing declining advertising revenue which had forced the company to lay off almost 15 percent of its employees, Microsoft’s aggressive takeover attempt, and Google’s abandonment of its advertising deal, CEO Jerry Yang has decided to step down.
His company is now looking for a new leadership.
Related posts: