Norway's Adevinta buys eBay's ad business for $9.2bn

OSLO: Norwegian online ad specialist Adevinta said Tuesday it had reached a $9.2-billion cash and shares deal to buy Ebay's classified ad business, and create the largest player in the field.

Adevinta will pay $2.5 billion (2.2 billion euros) in cash as it acquires eBay Classifieds Group which includes classified ad sites such as Gumtree in the US and Kijiji in Canada and Italy.

Adevinta will also transfer shares worth $540 million to eBay, giving it 44 percent of the Norwegian company's capital.

"With the acquisition of eBay Classifieds Group, Adevinta becomes the largest online classifieds company globally, with a unique portfolio of leading marketplace brands," Rolv Erik Ryssdal, CEO of Adevinta, said in a statement.

Adevinta was spun off last year from the media group Schibsted, which held onto a majority stake, and is present in 15 countries in Europe, Latin America and North Africa.

The combined firm will "benefit from solid market positions across 20 countries, covering one billion people with three billion monthly visits," Adevinta said.

Its combined revenue in 2019 stood at $1.8 billion - ahead of competitors such as Axel Springer Classifieds ($1.33 billion) and Prosus Classifieds ($1.28 billion) - with pre-tax earnings close to $600 million.

The impact of the Covid-19 pandemic has accelerated a migration to online shopping in many markets, as physical stores have had to close temporarily and sometimes permanently, and Adevinta intends to keep growing.