Internet portal Lycos Europe has purchased pan-European portal Spray Network NV in a stock swap valued at 674 million euros.

Lycos Europe will issue 84.3 million Lycos Europe Class B shares as part of the agreement, which represents 27 per cent of "Lycos Europe's share capital post transaction", the company said.

Losses Lycos Europe, a joint venture between Bertelsmann AG, Gruner und Jahr AG & Co, and US based Lycos is extending its reach in Europe after suffering heavy fourth-quarter losses. In September the company posted a quarterly loss of 52 million euros for the quarter ending June 30.

Lycos Europe’s interest in Spray is due to its strength in the Scandinavian market, its number two position in Germany, its popularity with a leading mail-provider in France, and its strength as a community provider in Italy, the company said.

According to Lycos, it wants to exploit Spray's traffic, as combined the two companies will have 19 million unique visitors per month in 12 countries.