eBay to revisit acquisition targets - Rumour

Thu Feb 28 2008, 08:59 AM

eBay says it may acquire firms that were previous targets, if current US market conditions keep share prices low. eBay's VP of corporate development, Lorraine McDonough tells Information Week that eBay turned down good strategic deals in the past due to high prices. "With the market readjustment in 2008, maybe we will have the opportunity to revisit some of those," she says. No details were given on possible targets.

Deal Details

  • Status rumoured
  • Buyer eBay

The online auction giant closed a number of medium-sized acquisitions over the last year, implying that a truly market-driven sale will be for a large sum. In Jan, eBay bought fraud detection provider, Fraud Sciences, for USD169m in cash. In Apr 2007 it paid a rumoured USD40m to USD45m for online discovery service, StumbleUpon. Meanwhile, in Jan 2007, it acquiring online ticket exchange Stubhub for USD310m cash.

In Nov, eBay was rumoured to have bid for European auction community Tradus, formally known as QXL Ricardo. This was never completed and a month later it was acquired by South African media group, Naspers, for USD2bn.

With a weak US market and fears of recession, McDonough says: "In the end, I suspect you're going to see higher premiums paid for public deals, although lower purchase prices." The last large-scale eBay acquisition was Skype in Sep 2005. For this, eBay paid USD2.6bn upfront in cash and stock. However, last year it was reportedly forced to write-down Skype's then USD4.3bn valuation by USD1.4bn. This was due to monetising problems associated with VoIP communications.