A majority of sellers thought eBay should sell its ticket marketplace when we surveyed them in January, so this week’s news that eBay found a buyer for StubHub at a price tag of $4.05 billion isn’t likely to come as a disappointment.
We had surveyed readers to learn what they thought of activist investor Elliott Management’s recommendations to eBay’s Board of Directors when it approached them on January 22, 2019.
Among Elliott’s recommendations for eBay to become a “better and more valuable company”: consider selling off its two subsidiaries.
We asked readers at the time, “Do you think eBay should sell its ticket marketplace Stubhub?” and they responded as follows:
Yes: 59%
No: 10.5%
Don’t Know: 30.5%
We also asked readers, “Do you think eBay should sell its classifieds business (eBay Classifieds Group)?” and they responded as follows:
Yes: 54%
No: 13%
Don’t Know: 33%
As we noted when we published the survey results in February, the issue of whether eBay should sell StubHub came down to whether sellers felt the ticket marketplace was contributing revenue or whether it was a distraction.
For example, one reader feared that without the revenue stream from StubHub, eBay would turn to marketplace sellers through higher fees: “(eBay) needs all the income it can get. If it isn’t getting anything from StubHub, it’s going to get it from sellers.”
But others felt that without StubHub, eBay could better concentrate its efforts on the eBay marketplace, to the benefit of sellers. Explained one reader, “I have no dealings with Stubhub, but if it would help focus on the core business and all the problems, then yes, remove it from the picture.”
One respondent thought the sale of StubHub and eBay Classifieds would provide cash eBay could use to invest in the Marketplace. However, interim CEO Scott Schenkel told CNBC yesterday that proceeds from the deal would be put toward stock buybacks, dividends and M&A investing.
Sellers would not benefit from buybacks or dividends. But it’s interesting Schenkel mentioned plans for merger and acquisition activity – eBay could very well be eyeing acquisitions of its own . (Any guesses?)
What do you think eBay should do with the $4 billion windfall? Join in the discussion on the EcommerceBytes Blog.
