Dec. 14 (Bloomberg) -- GUS Plc, the British owner of the Experian credit-checking business, bought U.S. online price- comparison service PriceGrabber.com for $485 million to expand its Internet operations. The stock rose to the highest since February.

The purchase adds a business whose sales and profit will grow by about 50 percent this year, London-based GUS said today in a statement. The transaction, which is being funded from existing bank facilities, should add to GUS's earnings in the first year, Experian Chief Executive Don Robert said on a conference call.

GUS, which this week spun off its 65 percent stake in luxury- goods maker Burberry Group Plc, is seeking to enlarge Experian before a planned separation from U.K. retail chains including Argos and Homebase. The company is delaying plans to split the businesses until the U.K. consumer climate becomes more favorable. Today's purchase is Experian's biggest in more than seven years.

``GUS is now becoming almost an Internet stock rather than a retailer,'' said Stuart Fraser, a director at Brewin Dolphin Holdings, which oversees $30 billion. ``Experian is dominating the group now and this is an add-on for the Experian offering. That's where the value of the company is perceived at the moment.''

Shares of GUS advanced 8.5 pence, or 0.9 percent, to 992 pence in London, the highest since Feb. 11. The stock has risen 5 percent this year and is headed for a third straight annual gain.

Shopping.com, Shopzilla.com

PriceGrabber.com is the third-largest U.S. Internet shopping search engine and operates in a $400 million market that is projected to grow by about 40 percent annually for the next five years, GUS said. The Santa Monica, California-based company, which was founded in 1999, compared prices of products such as computers and clothing for more than 17 million users last month, GUS said.

More than 9,000 online retailers are represented on the PriceGrabber.com service and pay a fee each time they get a lead. The service powers comparison shopping on more than 300 websites, including About.com, Ask Jeeves, BellSouth, Comcast and MSN.

The acquisition will enable Experian and PriceGrabber.com to make targeted offers to each others' customers, Robert said. For example, the combined company will be able to offer a product from a home improvement retailer to a customer searching for a cheaper mortgage rate on Experian's Lowermybills.com Web site, he said.

`Significant Synergies'

Merrill Lynch & Co. analyst Mal Patel expects ``significant synergies from integrating the business into Experian's platform,'' he said in a note to clients. Merrill raised its 12- month share-price estimate on GUS shares to 1,100 pence from 995 pence and maintained its ``buy'' recommendation on the stock.

Today's transaction means the three largest U.S. Internet shopping search engines have all been acquired this year. EBay Inc., the world's largest Internet auctioneer, bought Shopping.com in August for $620 million in cash, while Shopzilla.com was acquired by publisher E.W. Scripps Co. for $525 million.

``We believe the multiple with our transaction is in line, if not a little less, than those two,'' Experian's Robert said.

Closely held PriceGrabber.com will make earnings before interest and tax of about $25 million in 2005 on revenue of $60 million, Robert said on the conference call.

PriceGrabber.com is planning to expand its start-up operation in the U.K., where it employs five people, the company's chief executive, Cameron Pourzanjani, said on the call.

``We were planning to grow on our own, but as result of this acquisition we'll be in a better position to grow it faster,'' said Pourzanjani, who is PriceGrabber.com's largest shareholder.

To contact the reporter on this story: Paul Jarvis in London at pjarvis@bloomberg.net.

Last Updated: December 14, 2005 11:53 EST