Intuit buys into finance Web site

Intuit has announced plans to splash out $40m (#24.4m) on a 19% stake in Internet search engine firm Excite, less than 24 hours after revealing that it is cutting 9% of its workforce, writes Stuart Lauchlan.

The two companies have signed a seven-year agreement to produce a personal finance Web site for consumers who want financial news, quotes and stock information.

'This is not about providing stock news,' said Joe Kraus, founder of California-based Excite. 'It's about buying a house or planning retirement.'

Intuit will purchase 2.9 million shares at a cost of $13.50 each. The cash injection means that Excite will cancel a planned secondary share offering.

George Bell, Excite's chief executive, said: 'When we announced the secondary offering, the market was choppy, and it got choppier. We are adequately capitalised now.'

The deal was disclosed less than a day after Intuit announced the closure of its 300-person New Mexico telephone service centre as well as a further 50 jobs in northern California and 70 in Europe, in the wake of lower sales of its flagship Quicken personal finance software.

The new Intuit/Excite channel will be distributed via Excite, Webcrawler and Magellan and through Intuit's Quicken Financial Network Web site.