The New York-based USA Interactive said it would pay half stock and half cash for the purchase of the Miami-based Interval from venture firm Willis Stein & Partners of Chicago and other investors. It also retained an option to pay all cash in the deal for the company, which sells timeshares in vacation condos that owners can swap for spots around the globe.

USA's Chief Executive Barry Diller has stated publicly that he's looking to spend $9 billion on e-commerce acquisitions over the next few years. The latest news puts money where his mouth is on his promise to build USA Interactive into an online travel and e-commerce powerhouse.

In a statement, Diller called the deal "(a)nother notch in our belt of interactive services with real revenues, earnings, and strong growth - one in which online migration over time is assured - and one where many of our current services interrelate providing all kinds of new opportunities for each other."

Although the purchase would mark USAI's first foray into the timeshare business, the deal would complement its travel and hospitality portfolio companies. Already, USA Interactive has paid $1.3 billion for a controlling stake in online travel heavyweight Expedia, Inc.. The company also holds controlling interests in Ticketmaster, which operates online dating concern Match.com and city guide site Citysearch.

Plus, the company is in the midst of launching a new cable channel called USA Travel Channel, its platform for uniting transactions, television and travel with online travel sales it picked up with its acquisition of online travel company National Leisure Group.

Interval International is not a big player online, but the idea would be to shift a larger portion of the company's timeshare business online much the same way it has done with its stake in Hotels.com (formerly phone-based Hotel Reservation Network), which sells a majority of hotel rooms online.

The company said it would also use the assets to leverage USAI's ticketing and local information services in order to create benefits programs for its members.

Interval is expected to contribute $220 million worth of revenue and $60 million of cash earnings to USA Interactive's 2003 balance sheet. The chief executive of Interval, Craig M. Nash, is expected to stay with the company, which makes money from fees paid by consumers and developers for membership, exchange, reservation services and other travel related products. The company does not build or sell timeshare properties, whose average price is about $15,000.

Shares of USAI closed up 32 cents at $28.20 Thursday.