eBay issued a statement on Friday after rumors surfaced it was getting closer to selling its eBay Classifieds Group business unit.
Citing unnamed sources, the Wall Street Journal reported on Friday that parties interested in eBay Classifieds included private-equity firms TPG and Blackstone as well as Naspers Ltd. and Axel Springer SE. eBay has also started reaching out to other potential buyers, according to the Journal (paid subscription required).
In its statement, eBay said it has been “exploring potential value-creating alternatives for Classifieds and continues to be in active discussions with multiple parties regarding a potential transaction.”
And, it wrote, “As previously noted, eBay expects to provide an update regarding this process by the middle of the year. eBay remains committed to maximizing the value of Classifieds for eBay shareholders.”
The press release quoted eBay’s interim CEO Scott Schenkel:
“eBay’s Board and management are committed to driving significant returns to shareholders by maximizing the value of Classifieds and positioning our Marketplace business for long-term success. The Classifieds review process, together with the StubHub sale and our initiatives to increase volume, revenues, margins, and cash flow while continuing to invest in long-term profitable growth, demonstrate this commitment. We are acting with urgency while focusing on the ultimate objective of maximizing the value of Classifieds.”
The company also wrote, “In addition to eBay’s portfolio review, the Company’s management team has executed numerous value creating actions since the beginning of 2019 that are transforming eBay’s business and strengthening its foundation for growth,” providing some examples such as scaling Managed Payments in the US and Germany.
Activist investors had begun pressuring eBay to split up its business units in January 2019, and last week, eBay sold StubHub for $4.05 billion.
Some sellers had hoped eBay would invest much of the funds in the Marketplaces business. However, eBay chose to “create shareholder value” by expanding its share buyback plans for 2020 from $1.5 billion to $4.5 billion, as we reported last week.
You can read eBay’s full statement on the eBay corporate blog.