Microsoft Buys Price Comparer Ciao.com

Microsoft has bought European price-comparison service ciao.com for over $480 million.

Microsoft is lookin to improve its profie in Europe for online advertising, e-commerce, and Internet search…so the company has entered into a deal to buy Greenfield Online, which owns European price comparison and review service ciao.com. The all-cash deal will snap up all the outstanding shares of Greenfield Online for $17.50 apiece, with the total transaction totaling some $486 million. The companies expect the transaction will be completed in the fourth quarter of 2008.

Ciao offers price comparisons, user reviews of technology and consumer products, and enables users to join groups and share opinions. Ciao earns revenue on referral fees, advertising, and e-commerce sales.

“Ciao’s success has been led by a team of talented people who took a unique combination of intuitive technology and the insight that comes out of their passionate consumer community to become one of Europe’s leading shopping comparison sites,” said John Mangelaars Microsoft’ VP for consumer and online in Europe, the Middle East, and Africa, in a statement. “This makes the company a fantastic asset to the future of our search offer. Integrating Ciao’s capabilities into Live Search will provide a strong launchpad for our commercial search offer in Europe and enhance our e-commerce offering on MSN.”

The Microsoft acquisition also means Greenfield Online will be withdrawing from a previous merger agreement with Quadrangle Group, which will cost then $5 million.

Greenfield also operates online survey solutions that Microsoft isn’t interested in; Microsoft says it has “secured a buyer” for those services.

Ciao currently boasts over 26 million unique visitors a month, and Microsoft no doubt hopes to use the acquisition to bolster its presence in the European Internet market. You think Google dominates online search in the United States? In Europe, Google is even more dominant, accounting for 79 percent of the Internet search market, with Microsoft having carved out a whopping 2 percent stake for itself.