Ebay and Norway’s Adevinta announced that they will sell three British units so that they can get UK regulatory approval for a US$9.2 billion deal which has been on the cards since July 2020, reported Yahoo News.
Last month, the UK Competition and Markets Authority (CMA) stated that Adevinta’s anticipated purchase of eBay Classified Group (ECG) could lead to higher prices and less choice for consumers.
It stated both Adevinta and ECG operate online classified advertising platforms in the UK. These websites, Adevinta’s Shpock and ECG’s Gumtree, allow people to buy and sell a broad range of used or new goods.
Meanwhile, eBay’s marketplace is the largest platform for people to sell goods to one another in the UK.
The CMA explained that with the sale to Adevinta, eBay will acquire a 33.3% voting stake in Adevinta and positions on the Adevinta board which “means that eBay will be able to participate in the management of Adevinta and could enable it to influence the business strategy for both Gumtree and Shpock.”
Under the deal, Adevinta will acquire ECG in return for US$2.5 billion in cash and 540 million shares, making the US firm Adevinta’s largest shareholder with a 44% stake and 33.3% of the vote.
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