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OpenSite to snap up Bidder's Edge

The auction software company will announce tomorrow that it has agreed to acquire Bidder's Edge, an auction service site.

Software company OpenSite will announce tomorrow that it has agreed to buy Bidder's Edge, an auction service site.

Under terms of the deal, Bidder's Edge will remain in its Burlington, Mass., headquarters and will maintain its own Web site, said James Carney, chief executive of Bidder's Edge. The company also will maintain its current management team.

Together with Bidder's Edge, OpenSite will be able to provide clients with the technology to launch online auctions and the avenue to publicize those sites, Carney said.

"We will provide the complete solution," he said.

Carney and representatives of OpenSite, which is a quiet period due to public offering, declined to provide the financial details of the acquisition. They said only that OpenSite has signed a letter of intent to acquire Bidder's Edge.

Although not as popular as the auction software developed by FairMarket, OpenSite's software is used by several online auction sites, including those of SharperImage.com and CNET, the publisher of News.com.

"OpenSite expects this combined offering to increase the volume of buyers and sellers directed to OpenSite-powered sites," Kip Frey, chief executive of OpenSite, said in a statement.

Under the deal, OpenSite will fold its auction search engine, BidStream.com, into Bidder's Edge's search, Carney said. The combined search feature will continue to comb other auction sites such as Amazon.com and Yahoo in addition to those running on OpenSite's software, he said.

Bidder's Edge's auction search engine is at the center of a dispute between the company and online auction leader eBay. In December, eBay sued Bidder's Edge, claiming that its search engine violates eBay's intellectual property.

Earlier this week, eBay said that the U.S. Department of Justice's antitrust division had made preliminary inquiries about the online auction market and about the company's dealings with Bidder's Edge and AuctionWatch, a San Bruno, Calif.-based auction service site.

In related news, Carney said that Bidder's Edge filed a countersuit against eBay today, charging the company with anti-competitive actions. The countersuit is unrelated to the Justice Department's investigation, he said.

"We already had this in the works," Carney said.

OpenSite has been apprised of eBay's suit against Bidder's Edge and the company's response, Carney said.