eBay is flush with cash this week. It sold an 80% share of its eBay Korean unit for $3 billion on Sunday, and today it announced it sold over 134 million shares in Adevinta ASA for €2.05 billion, which is equal to over $2.3 billion, according to today’s exchange rate.
In June, we reported that eBay sold its Classifieds business to Adevinta for $2.5 billion in cash and a 44% equity stake, but was forced to reduce its ownership to 33% to resolve competition concerns raised by Austrian regulatory authorities.
eBay revealed today’s sale in a filing with the SEC where it wrote the following:
“On November 18, 2021, eBay International Management B.V., a wholly owned subsidiary of eBay Inc. (“Seller”), completed the previously announced sale of 134,743,728 Class A shares of Adevinta ASA held by Seller to Astinlux Finco S.à r.l., a limited liability company (Société à responsabilité limitée) organised under the laws of Luxembourg (the “Transaction”). Seller received proceeds of approximately €2.05 billion in connection with the completion of the Transaction.”
Upon the sale of eBay Korea on Sunday, eBay CEO Jamie Iannone had stated, “We believe this deal allows eBay to further focus on growing our core marketplace and will offer additional value for our customers, employees and shareholders.”
Since 2019, eBay has sold its StubHub ticket-resale marketplace, its Classifieds business, and eBay Korea.
What will eBay do with all the cash it added to its coffers this week? Shareholders are the beneficiaries. As we noted three days ago, eBay said it remained committed to buying back up to $7 billion of shares in 2021. Last year, it repurchased $5.1 billion in common stock, and it bought back $5 billion in shares in 2019.
So they have added another $5 billion to spend on buying back more shares of their stock to try and keep the price elevated so they can continue to collect those annual bonuses. They have already shown many times that they have no intention of spending the money needed to make their site once again be a usable site for both buyers and sellers Next quarter I will once again not be surprised to see that Ebay has further eroded their base of active buyers unless it is more scammers continuing to open additional accounts so they can steal more money from the sellers just as Ebay seems to do these days.
They continue to charge more and more for a site that has become no more than a 3rd rate platform.