eBay buys Bill Me Later and Danish classified sites
On the same day the company said it was laying off 1,000 staff worldwide, eBay has announced more than a billion dollars’ worth of new acquisitions.
Payments service Bill Me Later has been purchased for approximately $820 million in cash and approximately $125 million worth of outstanding options. Bill Me Later is the second-largest online-focused payments service, offering flexible payment options to shoppers without the need to use a credit card online, though sadly it’s only available to US customers at the moment. eBay CEO John Donahoe called BML “a company that belongs with PayPal”: though PayPal already has various credit options available to shoppers, the acquisition of PayPal’s strongest competitor will certainly secure eBay’s hold on the online payments market.
eBay have also entered the Danish ecommerce market with the purchase of Den Bla Avis and BilBasen, two leading online classified ads sites in Denmark, for approximately $390 million. Both companies began as print publications but have successfully transitioned to online advertising as well, generating more than 180 million page views per month between them.
-6.76% today already, $17 and dropping. Maybe it’s the general mood of the market? or maybe it’s not.
Edit. Sorry make that -7.25%
Up & down like a yoyo.
Track it here live !!!
Instead of it being Paypal – an eBay company :
…. one day it may well read –
eBay – a Paypal company !
#1 Ain’t just eBay. The Dow Jones plummeted well over 300 points today and dropped beneath 10,000 for the first time since 2004 😯
That’s over a 3% drop in a day, and the Nasdaq is dropping just as fast
Ebays share price Oct 6 2004 was $48.30, lost 2/3rds in 4 years
90% of share prices have been battered over the last year so Ebay is certainly not alone,
many are trading at half and sometimes much less than they were three years ago,
many big names especially retailers
The share price drop is due to JD & the way ebay is operating. It has been said many times before, in a recession ebay should do well, it is the type of business that people would head to, to save money and flog off unwanted stuff for extra cash.
The share price has been plummeting for the last 6 months.
The ebay graph doesn’t reflect todays falls.
#3 I am aware of that Chris. It would take a very brave person to suggest that the 2/3’s drop in share value in 4 years was OK because the economy is suffering overall.
Mind you saying that, people don’t moan when the price of beer drops, or the price of bread drops but when the price of shares drop we all moan, if you take a long term view on stock it will in most cases show a return overtime, clever investors will be buying at the moment and taking advantage, the more stock drops the more you can buy for your money.
I for one am very interested in investing in eBay at the moment, there is no way in the world it will go bust and if it doesn’t recover stock value significantly in 6 months someone will buy it, eBay would definately be on my Buy list especially if they brought in some fresh talent IMO JD was a backwards step, eBay needs some big sellers involved in the day to day stuff, it’s always the short term view with eBay these days and thats fine if you want to pander to the wall street brokers, invest within would be my advice to eBay and take a long term view on sucess, it worked for amazon.
Well if it’s just the recession, ebay & Amazon would be similarly effected.
A quick comparison check back over the last 6 months, which is the nearest I could get to the middle of the main changes from JD and,
Someone’s down about 13% and someone’s down about 43%, can you guess which way around it is?
It’s a fair point that stock markets have been in decline across the board but a quick check using the charting tool on MSN Money shows that over the last year, the three main US indices are down between 25% and 30% but eBay’s stock price is down over 50%.
Over three years: the Dow is about the same and the S&P and NASDAQ indices are down by less than 10%; eBay is down by over 50%.
I don’t think it’s just the market and I don’t think it’s a case of everyone else being out of step but eBay.
It’s hit sub $17, $15 and I will mortgage the house and buy.
It doesn’t matter how cheap it is, if something is worthless, it still isn’t a bargain.
Paypal is the golden egg, but only because ebay insist on it, if ebay folds* then the value of paypal plummets.
Ebay is a damaged brand, which is why it is so cheap.
* I use that in the generic sense, not in the bankrupt meaning.
I agree that something can be cheap and still overpriced.
There were people still buying Bradford and Bingley shares on the Friday before it was nationalised who were presumably taking a flutter on them not being able to go any lower …
Why didn’t Ebay just buy Newcastle United?
Am I missing something here? The world is heading into recession, Ebay cuts staff AND buys 2 businesses which don’t seem at all recession-proof to me. Cutting staff may be a good move, although I can imagine eBay’s customer service will get even worse, if that’s possible.
Online advertising will surely suffer during an economic downturn, and owning a business which encourages people to go into more debt seems like a huge risk in these economically challenging times. But what would I know, I’m just a bookseller.
Deutsche Bank agrees with your view.
October 7, 2008 10:12 AM EDT
Deutsche Bank reiterates a Sell rating on eBay (Nasdaq: EBAY) and lowers Price Target to $16 ($19 previously)
Deutsche analyst says, “While acquisition, HC reductions and in-line 3Q may be the good news, we think the bad news remains that fundamentals are weakening in the core business (which needs to be fixed through increased demand, lower seller fees and R&D re-investment). These issues, along with flat-to-down Gross Sales exiting 3Q and strengthening USD, should place significant pressure on earnings at least through 2009…We like the BillMeNow story/concept and strategic fit, but not when there’s a credit crisis, consumer spending decline and plenty of issues to address/fix in the core business. These concerns, along with a hefty price tag for a business with hefty capital requirements and earnings dilution, clearly suggest bad timing on eBay’s part.”
Fell asleep with the radio on last night and woke up with a start during the coverage of the US Presidential Debate when I heard John McCain mention Meg Whitman as a possible candidate for Treasury Secretary. Did I eat too much cheese yesterday evening or has anyone else seen any mention of this?
Great article on Ebay’s purchase of Bill Me Later here:
$15.20 and falling, time to buy ?
Paypal alone must be worth more than this,
Down 20% today, to $14, concerns over next three months trading
Whirly is off to mortgage the house!