Shopping Discussion

EBay sells classifieds unit [including Kijiji] to Norway’s Adevinta in $9.2-billion deal

  • Last Updated:
  • Jul 21st, 2020 11:27 am
[OP]
Deal Expert
Jan 7, 2002
26280 posts
23385 upvotes
Waterloo, ON

EBay sells classifieds unit [including Kijiji] to Norway’s Adevinta in $9.2-billion deal

EBay sells classifieds unit to Norway’s Adevinta in $9.2-billion deal
Under the deal, eBay will receive $2.5 billion in cash and 540 million shares of Adevinta, making it the largest shareholder with a 44 per cent stake and 33.3 per cent of the vote, they said.

“Adevinta becomes the largest online classifieds company globally, with a unique portfolio of leading marketplace brands,” Adevinta Chief Executive Rolv Erik Ryssdal said.

The combined company will have a presence in 20 countries, with Europe its biggest market. It will have an estimated revenue of $1.8 billion and earnings before interest, tax, depreciation and amortization (EBITDA) close to $600 million.
I wonder what changes this portends for Kijiji in Canada.
veni, vidi, Visa
5 replies
Deal Guru
Dec 5, 2006
13074 posts
8319 upvotes
Markham
So Ebay bought Adevinta? Sounds like it for me
[OP]
Deal Expert
Jan 7, 2002
26280 posts
23385 upvotes
Waterloo, ON
smartie wrote: So Ebay bought Adevinta? Sounds like it for me
They own "44 per cent stake and 33.3 per cent of the vote... making it the largest shareholder."

Depending on who owns the rest of the shares and how they vote, they may or may not have effective control of the business, e.g. if the founder(s) own >50% of the voting shares. Nevertheless I'd imagine eBay will have a seat or two on the board and will be "influential" in steering the business forward.

FWIW my impression is that Kijiji et al were sidelines in eBay's main business. Thus they got little attention from the mother corp. Now they will be a core part of Adevinta's business. Hopefully they'll get more attention as a result.
veni, vidi, Visa
Deal Addict
Jan 5, 2003
4800 posts
4549 upvotes
Toronto
bylo wrote: FWIW my impression is that Kijiji et al were sidelines in eBay's main business. Thus they got little attention from the mother corp.
IMHO, eBay's ownership of Kijiji acted as a "barrier to entry" (in economics terms) to anyone challenging eBay. Years ago, it would be very, very difficult to challenge eBay directly, but one danger was that a smaller, ecommerce-related site would grow to a point that it would start nipping at eBay's heels. For example, Craigslist was very popular and took away a lot of eBay's local sales. It could have grown (maybe sold or got some VC money, etc.) so eBay purchased Kijiji to compete against Craiglist's local sales and keep them from getting to a point where they would threaten mother corp. I know in those early days, Kijiji had humans checking posts (thus a lot less spam compared to Craigslist) and lots of other high costs so there's no way they were making enough money from listing fees to cover those expenses. But it made good financial sense to pour money into Kijiji to keep out additional competition.

I guess eBay isn't worried about this anymore, and its competition now is Amazon, Walmart, etc. "marketplace" sellers. Ironically, Kijiji's parent company was named "Marktplaas" (it was Dutch).
Member
User avatar
Mar 12, 2009
453 posts
469 upvotes
Ontario
My daughter uses Facebook marketplace. She says she feels safer using it rather than Kijiji because she can "Creep" peoples facebook posts to get a sense of who they are. I don't use facebook but my gut tells me that Kijiji may suffer a lot.

Top