eBay Sells Online Ad Business For $8 Billion
eBay is in talks to sell its online classifieds business to the Norwegian Adevinta Group. The deal can be officially announced as early as this evening.
Information that eBay is looking for potential buyers for the Classifieds Group division, the leader of the global online ad market, appeared in February of this year. At the time, it was valued at $12 billion, but the COVID-19 pandemic hurt the business, and now the company expects to sell it for at least $8 billion, according to WSJ sources. At the same time, the transaction with Adevinta will be executed both via cash and stock payments.
The Sale of Classifieds Group will be part of eBay's long-term development strategy. Back in 2015, eBay separated the payment service PayPal into a separate company. Last year, activist investors who own a stake in eBay, including investment funds Elliott Management and Starboard Value, increased pressure on the company's management, calling for it to get rid of all non-core assets. This view was not shared by the then CEO of the online auction, Devin Vanig, who was eventually forced to leave his post in September. And in November last year, the company received $4.05 billion from Viagogo, which bought the ticket sales service StubHub from eBay.
EBay's online ad service operates outside the United States — in Canada, Mexico, Australia, and some countries in Europe and Africa. Last year, its revenue was $1.1 billion, compared with $ 7.6 billion from eBay's auction business.
Adevinta operates digital trading platforms in 16 countries-mainly in Europe, Mexico, and Latin America. At the same time, the market value of the entire Norwegian company is just over $8 billion — about the same amount estimates its business online classifieds service eBay.