updated 9/1/2004 4:03:45 PM ET 2004-09-01T20:03:45

EBay Inc., which has been aggressively expanding in Asia, plans to increase its stake in South Korea's largest online auction company.

The Internet auction giant said Tuesday night that it would purchase nearly 3 million publicly held shares of Internet Auction Co. from institutional investors, mainly venture capitalists, to boost its ownership stake from 62 percent to 86 percent.

The $325.6 million cash purchase is expected to be completed as soon as the Seoul-based company's stock hits a target price of 125,000 Korean won, or $108.85, and clears local securities regulations.

Internet Auction Co. traded Wednesday at 115,100 Korean won, or $100.23, up 12 percent from Tuesday. Shares in eBay inched up 42 cents to $86.96 in midday trading on the Nasdaq Stock Market.

San Jose, Calif.-based eBay said it hopes to increase its stake further in the upcoming weeks. Spokesman Chris Donlay said Wednesday the company is "willing to buy any and all shares from anyone who wants to sell them."

EBay said the purchase would not affect its financial results. Executives said in July they expected 2004 sales as high as $3.185 billion, $35 million higher than they previously predicted.

Although South Korea slipped into a recession in 2003, its 48 million residents present a potentially lucrative e-commerce market. South Korea has the world's highest percentage of households using broadband Internet connections, with nearly three-quarters logging in from home at high speed. It's the world's 12th largest economy, and the third largest in Asia.

Internet Auction is the most recent target of eBay's Asian expansion. Although eBay pulled out of Japan in 2002 because it couldn't compete against homegrown sites, the company has rapidly expanded elsewhere in Asia, opening offices and advertising in Hong Kong, Singapore, Taiwan, Korea and India.

In June, eBay announced a $50 million acquisition of Baazee.com, India's most popular online shopping site. And last year, eBay completed its purchase of EachNet for $150 million, after an initial investment of $30 million. EachNet, China's largest e-commerce site with 5.5 million registered users, competes against Alibaba.com. Sunnyvale, Calif.-based Yahoo Inc. also plans to open a Chinese auction site later this year.

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