In a deal expected to create the world’s largest online classifieds company, eBay Inc. has agreed to sell its ad division to Adevinta ASA, the Norwegian online marketplace, for $9.2 billion, the companies announced Tuesday (July 21).
The combined company will solidify 20 markets containing 1 billion people and is likely to attract 3 billion monthly visits, the companies said. The cash and stock deal will make eBay the largest shareholder of Adevinta.
Under the terms of the deal that is expected to close early next year, eBay will receive $2.5 billion in cash and 540 million shares of Adevinta, 44 percent ownership of the combined company and a one-third voting stake.
The companies said they expect the new company will earn as much as $185 million in annual revenues within three years.
“We are pleased we reached an agreement with Adevinta that brings together two great companies,” said Jamie Iannone, eBay’s CEO, in a statement. “eBay believes strongly in the power of community and connections between people, which has been essential to our classified businesses globally. 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 operates in 15 countries, and its portfolio includes nearly three dozen digital products and websites.
The San Jose, California-based online selling mega corporation’s classifieds’ platforms include a dozen brands in 13 countries. The combined company expands its reach to 20 nations.
“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,” said Rolv Erik Ryssdal, CEO of Adevinta, in a statement. “We have been impressed with eBay Classifieds Group’s achievements in recent years, leading across markets with nationally recognized brands.”
The companies said the Adevinta and the eBay Classifieds’ management teams share strategic principles developed through a history of acquiring and scaling online classifieds platforms to create value.
“This deal is a testament to the growth and potential of the eBay Classifieds business,” said Alessandro Coppo, senior vice president and general manager of eBay Classifieds Group, in a statement. “We are excited for our local classifieds brands to join Adevinta and shape a global leader in an industry full of potential.”
On Monday, PYMNTS reported the deal was in the works as the 25-year old auction and “Buy It Now” company refocuses its mission on consumer-to-consumer and business-to-consumer online.