EBay agreed to sell its online classifieds business to Norway-based digital marketplace owner Adevinta.
The deal, valued at $9.2 billion, includes eBay getting $2.5 billion in cash and 540 million Adevinta shares. EBay will become a 44% owner of Adevinta with a 33.3% voting stake.
The combined company will have a presence in 20 countries, covering one billion people with three billion monthly visits. Europe will be its biggest market. It will have estimated revenue of $1.8 billion and earnings before interest, tax, depreciation, and amortization (EBITDA) close to $600 million.
“EBay believes strongly in the power of community and connections between people, which has been essential to our classifieds businesses globally,” said Jamie Iannone, chief executive officer of eBay. “This sale creates short-term and long-term value for shareholders and customers, while allowing us to participate in the future potential of the classifieds business.”
Adevinta is majority-owned by Nordic media company Schibsted, which has agreed to vote in favor of the transaction. Adevinta was spun out of Schibsted and listed on the Oslo Stock Exchange last year.
“This transaction demonstrates we are swiftly executing on the strategy we outlined at our IPO last year, and it brings further diversification through exposure to new markets with attractive margins and strong growth potential,” said Rolv Erik Ryssdal, CEO of Adevinta. “Our close cultural alignment with eBay Classifieds Group will allow us to pursue a shared vision. We look forward to a smooth integration, welcoming eBay Classifieds Group employees to the Adevinta family.”
After closing, Adevinta and eBay will partner in key areas to aid in the transition. The partnership is expected to create an estimated annual synergy of $150 to185 million within the next three years.
“With the acquisition of eBay Classifieds Group, Adevinta becomes the largest online classifieds company globally, with a unique portfolio of leading marketplace brands,” said Ryssdal. “We believe the combination of the two companies, with their complementary businesses, creates one of the most exciting and compelling equity stories in the online classifieds sector.”
The transaction is expected to close by the first quarter of 2021.
Stuart C. Wilson/Getty Images for eBay