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Axel Springer submit bid for eBay classifieds
It looks like eBay are closer to sealing a deal and waving goodbye to their classifieds business as Financial Times report that the German digital publishing house, Axel Springer have submitted an initial bid. Despite the process still being in initial stages, eBay could decide as early as next week who will proceed forward to the next round.
It was also reported that prior to the pandemic, the eBay classifieds business, which includes various vehicle marketplaces and general classifieds platforms such as Gumtree, could have fetched between an estimated $8bn and $12bn. Months after COVID-19 took hold and it is no longer certain whether a deal of that amount will still go ahead.
Axel Springer have been showing an interest in eBay’s classifieds since summer 2019 and despite the German company having one of the biggest portfolios of digital classified businesses globally, they are still up against some hefty competition including Adevinta, owners of the Shpock platform.
We reported on the interest in eBay’s Classifieds Group picking up around February this year. Selling the classifieds business will leave eBay Inc with just eBay marketplace and all excuses for not executing would be gone. Under John Donahoe, PayPal’s performance kept investors happy until activist investors came long and forced the sale of PayPal. Then under Devin Wenig the multi-year turnaround plan failed to drive revenue growth and more activist investors forced the sale of StubHub and want the sale of eBay Classifieds.
The question still remains whether selling off the family jewels will satisfy investors and if the new CEO can revitalise the marketplace, or if eBay will now be bite sized enough that an investor will snap up the marketplace place signalling the end of eBay Inc with eBay becoming a division of another company.
It would be great to hear from EBAY merchants whether they get any meaningful traffic referrals from Gumtree or Kleinanzeigen… this was always the logic for keeping them together.
I think there are two things in play
Gumtree is a nice buffer competitors have to beat before they come gunning for eBay
eBay Motors/Gumtree/motors.co.uk is a nice group and if you buy a car on eBay you could conceivably come back for parts and accessories.
The person who thinks of buying Gumtree should see the competition in the market place to see if its worth buying as a new player has emerged and buyers and sellers are moving here, Imarkets Australia’s online market place http://www.imarkets.com.au
Buy sell and classifieds and Australian owned and operated.