Amazon buys stake in Net catalog company

The e-tailer spends $5 million in stock to buy the stake in Altura International, though similar moves in the past have not always been fruitful.

Margaret Kane
Margaret Kane Former Staff writer, CNET News
Margaret is a former news editor for CNET News, based in the Boston bureau.
Amazon.com said Friday it shelled out $5 million to take a stake in a privately held company that builds and manages online shopping malls.

Seattle-based Amazon issued 717,316 shares of its common stock to buy the stake in Monterey, Calif.-based Altura International. Shares of Amazon closed at $6.97 Thursday.

Altura operates CatalogCity.com, and uses its software to help other companies run online stores. It also has deals with luxury goods and gift retailers including J. Jill, Hammacher Schlemmer, Harry & David and Ross-Simons.

As part of the deal, CatalogCity merchants will be featured on Amazon's site, and Amazon's products will be available through CatalogCity.

Amazon has a history of making investments in smaller dot-coms, but the deals have not always been fruitful. The company recently wrote off $41 million of its investments in Webvan, Sotheby's Holdings, WeddingChannel.com, Ashford and Drugstore.com. Webvan went out of business back in July.