eBay forced to sell UK subsidiary after $9.2 billion deal halted

eBay forced to sell UK subsidiary after $9.2 billion deal halted

eBay's plans to sell its classifieds group to Adevinta were put on hold last month after UK regulators blocked its plan. The two companies agreed this week to sell three of its UK units - Shpock, Gumtree (UK) and Motors.co.uk - in order to gain regulatory approval.

 

Earlier, the UK competition regulator expressed concerns about Adevinta's planned $9.2 billion acquisition of US e-commerce group eBay's classifieds business, sending the Norwegian company's shares down 4.3%. The UK Competition and Markets Authority (CMA) said in a statement: "The CMA is concerned that the merger may result in a loss of competition between Shpock, Gumtree and eBay's marketplaces, with only Facebook Marketplace remaining the main competitor."

 

The CMA pointed out that by selling its classified advertising business, eBay will acquire 33.3% of Adevinta's voting rights and a position on Adevinta's board of directors , "which may reduce consumer choice, increase fees or reduce innovation in platform supply, allowing people to buy and sell goods online." In their view, Adevinta's acquisition of eBay's classified advertising group will occupy a dominant position in the market and eventually lead to a monopoly.

 

eBay responded that eBay and Adevinta disagree with the CMA's statement, but they will work constructively with the CMA and are confident that they will find a suitable solution to address the CMA's concerns. This week, eBay and Adevinta jointly proposed selling their three divisions in the UK to allay the CMA's concerns.

 

In addition, eBay said it "remains excited about the proposed merger of Adevinta and eBay Classifieds Group." It also said that in 2019, eBay Classifieds Group's UK business accounted for less than 10% of its consolidated revenue, while Adevinta's UK business accounted for 1% of its consolidated revenue. Combined, the UK will account for less than 5% of total consolidated revenue.

 

The companies currently expect the transaction to close in the second quarter of 2021 (April to June), subject to final approval of the remedial implementation plan by the UK Competition and Markets Authority (CMA) and approval from Austrian regulators.

 

eBay announced the deal with Adevinta in July for about $9.2 billion, saying at the time that the combined group would have a strong presence in 20 markets, reach 1 billion users and generate 3 billion monthly visits.


E-commerce platform

eBay Platform

Cross-border e-commerce market

<<:  Elliptical machine demand increased by 250%! Many sports products are selling well in Russia

>>:  Beware! Oreo sues Indian biscuit company, sellers should pay attention to this kind of infringement

Recommend

U.S. holiday sales rise more than expected; apparel spending up 33%

According to the National Retail Federation ( NRF...

What is Innoventry? Innoventry Review, Features

<span data-docs-delta="[[20,{"gallery"...

Amazon issued a solemn statement, requiring sellers to sell fairly

Earlier, Amazon suspended a large number of accou...

Nearly 8,000 candlesticks recalled due to fire risk

The U.S. Consumer Product Safety Commission (CPSC...

What is Stone Pagamentos? Stone Pagamentos Review, Features

Stone Pagamentos is primarily engaged in payment ...

Open the book at a low price! Amazon's new project is coming soon

The first batch of merchants have already settled...