ING closing in on deal for ShareBuilder

Dutch financial-services giant ING is close to announcing an acquisition of ShareBuilder, the Bellevue online brokerage service, according to sources familiar with the deal.

One source, who asked that his name not be used, said Tuesday that the deal is expected to close in mid-November at a purchase price of more than $100 million. That would produce a solid return for some of the early venture backers in the 11-year-old company, though the source said it is hardly a grand slam since ShareBuilder is generating about $60 million in annual revenue.

Jeff Huse, the former chief technology officer at ShareBuilder, who spent nearly eight years at the company, said he has heard that ING Direct is paying $220 million. The deal is expected to close Nov. 14, he said.

"It is a terrific deal for them and it is a very good outcome. Patience has paid off," said Huse, who no longer holds shares in the company.

Founded in 1996 as Netstock Direct, the company has grown its online brokerage business by allowing investors to buy partial shares of stock in dollar increments. Investors also can set up weekly, biweekly or monthly automatic purchases of more than 6,000 stocks. That means an investor could allocate $50 each month to buy Google, which is trading at $694.77 per share and, therefore, too expensive for many to buy on the open market.

In 2004, ShareBuilder said it surpassed more than 1 million accounts and touted itself as the eighth-largest online brokerage in the country. (The Wall Street Journal reported earlier this month that the company now has more than 2 million accounts.) ShareBuilder is marketed through banks, credit unions and retailers, including Compass Bank, Costco, Wal-Mart and Boeing Employees Credit Union.

ING spokeswoman Pilar Teixeira declined to comment. Madrona Venture Group's Greg Gottesman, whose Seattle firm was an early backer of ShareBuilder, also declined to comment. ShareBuilder Chief Executive Jeff Seely was traveling and could not be reached.

Investors, including Madrona, Goldman Sachs, Wells Fargo and Safeco, sank $8 million into ShareBuilder in 2001. That followed $40 million that had previously been invested in the company.