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NYSE Owner $30 billion bid for eBay considered

By Chris Dawson February 5, 2020 - 11:50 am

The owner of the New York Stock exchange (NYSE) approached eBay with a take over offer which could have been north of $30 billion. The Wall Street Journal says that the two aren’t in formal talks and $30 billion bid for eBay negotiations have been dropped.

Now one approach has been made to eBay, the only question that remains is how many more there will be and if they will all be hostile without the blessing of the board or if someone will stump up the cash to effectively take eBay private.

The NYSE is effectively a marketplace for shares, so it’s not totally different to eBay’s business model, however there’s a huge difference between trading shares for a few thousand companies and trading over a billion discrete products from 6.7 million sellers to 168 million buyers on eBay around the world.

The interesting aspect to consider is what would an eBay acquisition bring to the marketplace? If eBay were no longer beholden to share holders the pressure to turn in more than half a billion or so dollars in profits on a quarterly basis would disappear. Would the pressure of having to turn in profits effectively allow eBay to press a reset button, totally revamp the marketplace, kiss goodbye to their current direction which is to squeeze ever more margin out of flat or decreasing sales, overhaul the technology and relaunch with a new direction?

Waving off profitability for a year would only be possible under private ownership – it would be a hard sell to investors to lay out a growth plan which ditches profits for a year when eBay’s recent history has been flat or very low growth. Amazon get away with it because they’ve shown distain for profits in favour of growth but eBay haven’t had stellar growth in recent years and so profits are all they have to offer investors.

There’s little doubt that now once possible acquisition has been made public that there will be more down the road and it would be no surprise to see the eBay marketplace sold in the near future. All that remains to discuss is if $30 billion bid for eBay didn’t tempt the board and investors what is the magic number that would? Is it $40 billion? $50 billion? Is it a waiting game and if eBay fortunes don’t improve then $30 billion might be more attractive. Will the numbers stack up if the StubHub sale is completed and Classifieds are also divested?

If eBay was taken private and you were in charge, what is the first thing you would do? Is it slashing fees or are fees not the underlying issue as you’ll happily pay them if the sales are flooding in? Is it the tech base and it’s time to totally revamp eBay’s 25 year old code base? Is it a direction swerve away from the new in-season stock to eBay’s roots of the quirky collectable that will get the buyers flooding back – which in itself is contentious as many sellers have built their businesses selling new products?

Where would you start? All ideas gratefully welcomed so long as they are constructive and will save eBay. Who knows, perhaps the current board and a new CEO could do the job without the eBay marketplace being sold off and effectively taken off the stock market and privatised.

  • andy
    2 weeks ago

    Will they accept best offer?

  • ifellow
    2 weeks ago

    Things cant get worse for sure.

  • Stuart
    2 weeks ago

    This is exactly what ebay doesn’t need. It needs a good, solid ten years of the same leadership with a focus on what it’s doing. If you look back at the big failed retailers, Woolworths, House of Fraser etc this is exactly what happened to them, 2-3 years of leadership, bits sold off, the whole company sold off, then it falls apart.

    All this whilst Amazon thunders on.

    Going private they will strip out every last penny they can and sell it off again in a few years.

  • SAM
    2 weeks ago

    30 Billion is that all it is worth now, I thought it was a 50 billion company…

    I said this was on the cards. The current leadership have virtually driven the site into the ground over a period of 3 years, the steep decline started just after 2016 and has continued.
    The site is generic and boring, penny chasing pay to play and they constantly want more for less, that can only last so long.
    eBay is like the p4U model (own nothing) who without the networks went bust overnight, and it is driving merchants (the networks) to alternatives with their high fees leading to high prices , shocking service, and boring platform which in turn drives customers to alternatives.

    The site is also badly policed with fake and miss sold products rift.
    Quality and service means nothing in the era of Pay to Play.

    I would get the USP back. A place where people can come looking for a genuine alternative ( but let merchants BUILD their own unique offering without choking them with fees, hiding listings and metrics and corporate waffle, and scrap Pay to Play on day one ) like it used to be. Let merchants breath and they will do the rest.

    That will bring back buyers and build from there, stop thinking short term and look at the site over a 5 year period.
    End of the day if they do not change they will not even be about in 5 years.

  • james
    2 weeks ago

    It was only one week ago you asked us
    “what would you do if you were ebay CEO?”
    and i answered with
    “find some chump to buy this sinking ship”.
    Maybe eBay execs do read tamebay after all….

    Possibly being taken into private ownership is the answer ebay need, however i can’t help but get the feeling that the owner of the NYSE would want to float it on the stock exchange at some point.

    Also it’s plain to most of us that ebay has been cash-grabbing for years, the numbers are to keep the investors happy and we know they’re hollow. if the investors also know this, why are they willing to pay an inflated share price before the bubble inevitably pops? the cynic in me says they lapped up devin wenig’s approach and have some new ideas for how to wring even more cash out of us.
    the optimist in me hopes they saw the cash-grabbing, know the inevitable outcome, but also see the long-term benefits of restructuring ebay for long-term growth rather than leeching sellers for short-term investor happiness.

  • Katie A
    2 weeks ago

    Has anyone heard from Alan Paterson who used to post on here?

    He had some very radical views on how to improve the marketplace and seemed to be uniquely in-tune with what was required. He regularly traveled round the UK helping ebayers like me – at no cost and apparently no financial reward. Accused frequently of being a secret employee of the company he received no financial gain and traveled using his own money – seemingly for the love of the ebay platform.

    Have sellers like this even quit? I know he had some health problems and had issues with buyers abusing returns last year. Has anyone heard from him?

    ebay seems to be going to pot and my guess is only sellers with a genuine love for the platform can make a difference. I heard he got repremanded by Concierge for helping fellow ebayers with their businesses! Have ebay gone mad?!

    Paterson seemed to have a unique take on what was wrong on ebay and what was causing its demise.

    Where have you gone Alan?

    • Jim
      2 weeks ago

      🤪

    • james
      2 weeks ago

      Hahahaha I had previously suspected Jim was a secret alter-ego of Alan’s. We seem to get along together exactly as well as i did with alan lol.

      Realistically though, Alan had some unique views, i’m not sure “uniquely in-tune” is how i’d describe them though. Alan seemed to be of the opinion ebay were everything ebay said they were. I suspect he found out the hard way and can’t face the shame of coming back here to complain about them now, after rubbishing everyone else’s complaints about ebay for years.

    • Ross K
      2 weeks ago

      @ Katie , I fear Alan Paterson may have quit. not heard from him in months. Yes he had some health issues but was also not happy with the way ebay was going.
      Maybe he is secretly negotiating the purchase of ebay 🙂

    • ross k
      2 weeks ago

      @James. not the way I see it. Alan only “stood” up for ebay when people were trashing it.

      Katie mentioned he had health issues. He had to be put in an induced comma to help with his breathing last year. Your post is bad taste laughing at the situation. Katie is correct about the health problems he has experienced which is no doubt why we have not heard from him on here.

      I was browsing back on previous posts and can’t see him “rubbishing” anyone who weren’t already trashing the platform they were partnered with. Alan made sense. Type “Alan Paterson Tamebay” into google and skim his posts over the years. can’t say he was wrong with much. and you are inaccurate with your assessment that he was forever positive about ebay. you have obviously been selective with the posts you read. He predicted many of the things that are now happening and was the first to point out the long term damage of certain initiatives that ebay introduced.

      You are a rude ignorant cowardly man trashing someone who is not here to defend themselves. He helped me on several occasion with my business and did not take a fee. His posts were “unique” (as Katie put it) because he was the only seller at the time being an advocate for the platform they had partnered with! if that doesn’t make sense to you then maybe you should not be selling on ebay. Alan was correct – often it was the sellers – and their lack of support for ebay that were damaging the platform.

      He also felt passionate about using his full name on here and putting this name to his opinions. Thats not the kind of person who you are describing:

      You wrote: “I suspect he found out the hard way and can’t face the shame of coming back here to complain about them now” – absolute utter non-sense. You are out of line James.

      Anyone reading James trash I invite you to read back posts on Tamebay. Alans predictions about the way ebay were going (and the ways to prevent it) were eerirly uncanny.

    • james
      2 weeks ago

      @ Ross.

      You’re welcome to see it differently, but if you want to take that tone with me i’m going to end up speaking to you the way i spoke to Alan.

      “You are a rude ignorant cowardly man”. same to you big chap. I may be rude, but i’m certainly not ignorant or cowardly. you seem to imply i wouldn’t say anything to Alan if he were here to defend himself, and are therefore a coward, you couldn’t be more wrong.

      I don’t know anything about alan’s health, i only know him from on here.
      you and him may be bestest mates, maybe he’s helped with your business, i couldn’t care less. me and him clashed heads on here and i have my opinions on him, but again if you’re going to speak to me like that, me and you are gonna clash heads too.

  • 2 weeks ago

    I think ebay is worth more than 30 billion…

  • jim
    2 weeks ago

    I was taking the piss
    this cult of the paterson is ridiculous
    hes a shoe seller with some experience ,not the flaming messiah

  • Jonah
    2 weeks ago

    Alan P had his own thoughts, often different to those of mine. However I can tell you his heart was in the right place. He had health issues and sadly I think a really bad buyer left him multiple DSR dings and ebay would not remove them. Sadly what happened to Alan could happen to anybody- ebay and it’s ludicrous metric systems could finish anyone’s business at the click of a button.
    Alan if you read this please let us know your ok, even if you don’t continue to post on Tamebay as before.

    • Alan Paterson
      1 week ago

      Thanks for your support and concern Jonah. Reports of my demise are grossly exaggerated. Rumours that I had defected to OnBuy are also untrue. 🙂

      yes, my health has been an issue of late but you are correct – my main ebay shop got something like 70 INRs in one week from the same buyer. To be fair to ebay they could not remove them (although they wanted to) as they were Service Metric defects which cannot be removed – even by concierge. I hate service metrics.

      On a separate issue I was also “told off” by ebay for helping other ebayers – “none of my business” apparently and “did not concern me”. I passionately disagree with this and if fellow ebayers reach out and want my input to their business – its always there for them FOC.

      ebay themselves sometimes forget the community spirt that is required to drive the business forward.

      @ Katie above – I will give you a call tomorrow evening but I am limited to what I can do at the moment.

      @ Ross K – mind your blood pressure (apologies to James)

      @ James Whether you think ebay (your business partner) is great or whether you think they are not great – your right! Thats my point! Your business will go far smoother if you respect and try to work with the platform. I like to take the easier more profitable route – therefore ebay are great (most of the time).

      @ Jim. Yes, I have been accused of having a God complex in the past BUT ….. I forgive you ……. AND there is a difference between a shoe seller selling on ebay and and an ebayer that happens to be selling shoes.

      I would also like to thank Tyler who used to post on here. he took the time to phone me yesterday (which prompted me to look at this thread) to see if I was ok. It gives me a warm fuzzy feeling inside (or maybe thats my medical condition) to see that the community spirit is not dead.

    • 1 week ago

      Good to know you’re alive and kicking Alan 🙂

  • Dav
    2 weeks ago

    This was just another short-term eBay stock pump and dump scam with multiple players involved. eBay insiders, activist investors, Wall Street traders, going with the fake buyout rumor so everyone can cash out at a higher price. This kind of thing happens at least a couple times a year it seems. Several “news” and “rumors” and “propaganda” type things always converging together. Stock was dumped hugely after hours and now downward again the stock will go. Likely going back where it was after their garbage earnings report. There is no buyout, the companies were never in talks, and eBay wasn’t selling anyway. Stock manipulation scam all around, likely excluding the “buyout” company ICE whose stock took a pounding while eBay’s went up. I guess they weren’t invited to the party.

  • Dav
    2 weeks ago

    So yes, what I’m saying is eBay are crooks. And we all know activist investors/hedge funds and Wall Street are as well. Everyone has to cheat like this for eBay stock to move because they can’t do it on their business results.

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