eBay is set to sell its remaining shares in online classified business Adevinta to private equity firms Permira and Blackstone for $2.2 billion in cash and 20% equity. This deal follows Adevinta’s acquisition of eBay’s classified business in 2020, which left eBay with $2.2 billion in cash and 540 million Adevinta shares. The transaction, subject to regulatory approval, is expected to close in the second quarter of 2024.
Key Takeaway
eBay plans to sell its remaining shares in Adevinta to private equity firms Permira and Blackstone for $2.2 billion in cash and 20% equity. The deal is expected to close in Q2 2024, subject to regulatory approval.
Originally majority-owned by Norwegian publisher Schibsted, Adevinta now plans to go private. It made the offer to eBay for its remaining shares through a newly created Norwegian LLC called Aurelia Bidco Norway AS.
The proposed deal values eBay’s entire stake in Adevinta at approximately $4.3 billion, an increase of $1.5 billion from the previously reported valuation in September. Adevinta’s shares had surged more than 21% following the leak of the potential bid by Blackstone and Permira.
This is not eBay’s first sale of Adevinta shares. In 2021, the company sold a portion of its stake in the classified ads company for $2.25 billion.
The funds from the sale will be used for general corporate purposes, and eBay remains committed to returning 125% of its cumulative free cash flow to shareholders through a combination of repurchases and dividends by 2024. After the deal is completed, Permira, Blackstone, and their co-investors will have the option to purchase additional shares from eBay, further reducing its ownership position to approximately 9.99%.
This sale is part of eBay’s broader shift away from its e-commerce ambitions. The company has previously divested its classifieds business, spun out PayPal, and sold its StubHub ticketing business. With classifieds generating only $248 million in revenues compared to eBay’s marketplace, which generated $1.9 billion in the same period, the company is focusing on becoming a large marketplace for various goods, including collectibles and authenticated apparel.
With revenues of $2.5 billion in its latest earnings report, eBay’s non-GAAP net income exceeded analyst expectations.
