E-commerce giant e-Bay has agreed to sell 10.2 percent of its Adevinta stock to equity firm Permira for $2.25 billion in cash. The deal comes after the Federal Competition Authority ordered e-commerce giant e-Bay to cut its holding in Adevinta to nothing more than 33 percent to approve the company’s plan of becoming a leader in the world of classified ads.
E-bay has been planning a tie-up with Adevinta in a bid to leveraging the opportunities that lie in Austria’s classified ads market. Getting approval from the country’s regulatory body was the last step in completing the deal. There were concerns over the impact of competition in the classified ads market by the country’s financial watchdog which led to the demand that e-Bay cut its Adevinta holdings. Adevinta operates online classified websites across Europe and was once a part of the Norwegian publishing group Schibsted.
Talking about the transaction with Permira, e-Bay said that “the transaction announced today with Permira provides a clear path to satisfying this commitment, while delivering value to eBay shareholders”.
Permira is a British global investment firm headquartered in London and was founded in 1985. The company has made more than 250 private equity investments in the following key sectors – healthcare, technology, Consumer services, etc.
As disclosed in the deal, e-Bay will sell10.2 a percent stake (125 million shares to Permira. This will leave the US-based company with a 34 percent holding of Adevinta stock. According to Adevinta, the e-Bay-Permira deal is expected to be sealed by the last quarter of this year.
In 2020, Adevinta agreed to purchase e-Bay’s Classified Group for $2.5 billion in cash and 540 million shares which values the transaction at almost $13 billion at the current stock market price.
The e-Bay-Adevinta deal is certainly one of those to look out for this year.