eBay Pays $945M For Bill Me Later; Buys Two Danish Sites For $390M; Cutting Staff By 10 Percent

• Posted: Thursday, October 09, 2008
• |
• Author: pradhana
• |
• Filed under: Business Analysis

By David Kaplan

eBay (NSDQ: EBAY) announced two acquisitions—spending over $1.3 billion altogether—this morning designed to shore up its other parts of its business in the face of declining profits and stagnant traffic at its primary online auction site. The company also finally addressed layoff rumors and said that it is indeed cutting 10 percent of its 15,000-person workforce. The company said about 1,000 full-time jobs will be affected, in addition to several hundred temporary workers and the elimination of open positions. The two acquisitions and the layoffs were summarized in a single release, with two others containing additional details.

-- The San Jose, CA,-based company says it has struck a definitive agreement to acquire Pay Pal rival Bill Me Later for approximately $820 million in cash and about $125 million worth of outstanding options, net of option exercise proceeds. The company will be combined with PayPal, which eBay already owns. The deal is expected to be completed by the end of the year. Release

-- Danish acquisitions: As part of its goal to increase its online classifieds holdings, eBay has turned to Denmark to buy Den Bla Avis and BilBasen for $390 million (about 2.1 billion Danish Kroner). The prices for the two weren’t broken out individually. eBay, which has a minority stake in Craigslist—the two are currently in the midst of a wide-ranging legal battle—has indicated that it wants to expand its focus on the online classifieds business.

Den Bla Avis and BilBasen is added to eBay’s global portfolio of such sites, including the Netherlands’ Marktplaats, Spain’s LoQUo, the U.K.’s Gumtree, Germany’s mobile.de and Kijiji, which is stronger in Europe, but has been working on building up its U.S. presence lately as a competitor to Craigslist. eBay boasts that this latest acquisition gives it an online classifieds business a stake in more than 20 countries and 1,000 cities.

As eBay hinted at its plans to buy more online classifieds last month, rumors began circulating that it planned to cut about 10 percent of its 15,000-person workforce. The company has not commented on the layoff rumors. Release [paidContent.org]

• Permalink
• RSS 2.0
• 
• 
• 
• 
•