Internet venture BuildOnline has merged its German operation with MyBau, a software company that is its largest competitor.
Contractors Bilfinger Berger and Strabag, MyBau's shareholders, have agreed to use BuildOnline's products. Under the terms of the deal, BuildOnline has secured business in Germany and Austria worth £5m over the next two years.

The move is BuildOnline's second acquisition in Europe in the past year – it bought I-Scraper in 2001.

Mark Suster, chief executive of BuildOnline, said the deal was a sign that construction firms were stepping up their investment in business-to-business software.

He said: "With BuildOnline's strong financial base and the backing of large strategic partners, we are in pole position to drive further consolidation across Europe."

Bilfinger Berger director Walter Hinder said the firm had chosen to join forces with BuildOnline because of its record with large European construction companies.

He said: "This deal supports our company strategy to accelerate e-business across our entire international business."

BuildOnline acquired I-Scraper in June 2001 along with £625,000 worth of contracts; the firm also has a strategic partnership with Balfour Beatty worth £10m.