Adevinta buys eBay's classifieds unit in $9.2 bln deal

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<p>By Nerijus Adomaitis and Pamela Barbaglia</p> <p>OSLO/LONDON, July 21 (Reuters) – U.S.
firm eBay Inc has agreed to sell its classified ads business to Norway’s Adevinta in a deal worth $9.2 billion, creating the world’s largest classifieds group, the companies said on Tuesday.</p> <p>Under the deal, eBay will receive $2.5 billion in cash and 540 million shares of Adevinta, making it the largest shareholder with a 44% stake and 33.3% of the vote, they said.</p> <p>”Adevinta becomes the largest online classifieds company globally, with a unique portfolio of leading marketplace brands,” Adevinta Chief Executive Rolv Erik Ryssdal said.</p> <p>The combined company will have a presence in 20 countries, with Europe its biggest market.

It will have an estimated revenue of $1.8 billion and earnings before interest, tax, depreciation and amortisation (EBITDA) close to $600 million.</p> <p>A source close to the deal said the Norwegian firm sweetened terms of its bid at the weekend by offering eBay a bigger stake, after the U.S.
firm’s board was initially split, with some members backing a $9 billion cash bid by online retailer Prosus .</p> <p>Jamie Iannone, eBay’s chief executive, backed Adevinta’s proposal and persuaded the board of its merits, the source said.</p> <p>Ryssdal told Reuters the coronavirus crisis had boosted digital marketplaces, with some Adevinta sites receiving more traffic in June than a year earlier, rebounding from a sharp drop in March.</p> <p>Ryssdal, who said he intended to stay in the chief executive role, said Adevinta would look for more acquisitions after completing the eBay deal, adding the combined company “would be a great platform to do that.”</p> <p>Shares in Adevinta, which was spun out of Nordic media company Schibsted and listed on the Oslo bourse last year, jumped almost 40% after trading resumed.

Schibsted shares climbed about 20%.</p> <p>SAVINGS</p> <p>Adevinta owns brands such as Leboncoin, France’s biggest online classified ads website, Brazil’s OLX and dozens more across Europe, the Americas and North Africa.</p> <p>The eBay Classifieds Group includes the Gumtree and Kijiji brands, and offers online ads to more than 1,000 cities around the world.

The business posted an operating income of $83 million on revenue of $248 million in the first quarter of 2020.</p> <p>The transaction, situs judi bola terpercaya expected to close by the first quarter of 2021, targets $150 million-$185 million in annual savings on EBITDA within three years.</p> <p>Most of the synergies are expected to come from IT, where eBay is much stronger, a person familiar with the deal said.</p> <p>Schibsted said the deal meant its stake in Adevinta would fall to about 33% from 59%, but it would have 39.5% of votes.</p> <p>Schibsted and eBay will appoint two directors each to the expanded board of nine, Adevinta’s investor presentation showed.</p> <p>Schibsted Chief Executive Kristin Skogen Lund told a presentation her firm intended to remain a significant shareholder in Adevinta but might sell part of its stake if it made further acquisitions.</p> <p>”We will have a larger liquidity and financial flexibility, but that doesn’t mean that we have any immediate plans (to sell),” she said.</p> <p>As part of Adevinta deal, the U.S.

firm agreed to sell Schibsted the Danish assets of eBay classifieds group for $330 million, reducing the cash consideration from Adevinta to about $2.17 billion.</p> <p>Citigroup advised Adevinta, while Barclays acted as lead financial advisor to Schibsted.

Goldman Sachs and LionTree advised eBay. (Reporting by Nerijus Adomaitis in Oslo and Pamela Barbaglia in London; Additional reporting by Arno Schuetze in Frankfurt; Editing by Jason Neely and Edmund Blair)</p></div>

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