eBay is in talks to sell its online classifieds business eBay Classifieds Group to Norwegian Adevinta, The Wall Street Journal (WSJ) reported citing multiple sources.
Information that eBay is looking for potential buyers for a division of the Classifieds Group, the global leader in the online classifieds market, appeared back in February this year.
Then it was estimated at $ 12 billion, but the COVID-19 pandemic hurt the business, and now the company expects to sell it for at least $ 8 billion, WSJ sources say. While the deal with Adevinta will be formalized both through payment in cash and in shares.
The sale of the Classifieds Group will be part of eBay's long-term development strategy. Back in 2015, eBay spun off the PayPal payment service as 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 to divest all non-core assets. This view was not shared by the then CEO of the online auction, Devin Wenig, who was eventually forced out of office in September. And already last November, the company received $ 4.05 billion from Viagogo, which bought the StubHub ticketing service from eBay.
eBay's online classifieds service operates outside the US - in Canada, Mexico, Australia, and some countries in Europe and Africa. Its revenue last year was $ 1.1 billion, compared with $ 7.6 billion from eBay's auction business.
Adevinta operates digital marketplaces 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 as the online classifieds service eBay estimates its business.
