Overstock.com / Ski West

Discount online retailer Overstock.com Inc. on Friday said it will acquire privately held Ski West Inc. in a $25 million deal that will expand its business into Internet travel services.

In addition to the acquisition price, Overstock said it will provide compensation based on future performance. Park City, Utah-based Ski West was founded in 2001, and provides hard-to-find lodging and vacation deals mainly in popular ski areas in the United States and Canada.

Overstock said it expects to close the acquisition by July 1. For the time being, Ski West will operate as a subsidiary of Overstock. Employees of Ski West are expected to be retained.

The acquisition comes just weeks after online auction company eBay Inc. announced it will acquire Shopping.com Inc. in a $620 million deal. Revenue for eBay was said to be slowing due to increased competition from retail-oriented search engines such as Overstock, as well as new pressure from Google Inc. and Yahoo Inc.

Overstock.com shares fell 37 cents to close at $38.64 on the Nasdaq.

© AP