American multinational e-commerce corporation, eBay is in advanced discussions to sell its Classified Ads unit to the Norwegian company Adevinta as the online auction forerunner tries to refocus on its core marketplace business.
Adevinta runs online marketplaces across Europe and Latin America.
The price of the cash-and-stock deal was not revealed, but the eBay unit is expected to sell for approximately $8 billion or more and the announcement of the deal can be expected soon.
The coronavirus spread has necessitated prolonged lockdown and social distancing measures in almost all countries of the world and this has prompted customers to switch to online shopping, increasing the demand for online marketplaces.
Previously, eBay reported that it was planning to sell off its classifieds business, with prospective buyers named at that time, including private equity firms TPG and Blackstone Group, Naspers, and German publisher Axel Springer SE.
eBay’s classified business, that owns brands such as Gumtree and Kijiji provides online advertising to more than 1,000 cities worldwide including Canada, Africa, Mexico, Australia and Europe.
During the first quarter of this year, eBay ‘s main marketplace unit created $2.1 billion in revenue, down from $248 million in revenue in its classifieds sector. Throughout 2019, the classifieds company gained $1.1 billion in revenue, compared to $7.6 billion for the eBay Marketplace, which is in competition with large online companies such as Amazon.
