eBay sold its classifieds business to Adevinta a few years ago after pressure from activist investors Elliott Management and Starboard Value while obtaining a stake in the company. On Tuesday, eBay announced its support for a deal that would net it $2.2 billion and a 20% stake in a newly privatized Adevinta.
eBay said it intended to use the cash proceeds from the prospective transaction for general corporate purposes – and it said it remained committed to share-buybacks and dividends to return capital to eBay shareholders.
The deal would see two private equity firms, Permira and Blackstone, acquire all the publicly traded shares of Adevinta. eBay said as part of the transaction, it would sell 50% of its shares in Adevinta for an estimated $2.2 billion and would exchange the remaining shares for an equity stake of approximately 20% in the newly privatized company.
The deal values eBay’s entire stake in Adevinta ASA at approximately $4.3 billion.
For six months following the proposed closing, Permira, Blackstone and their co-investors would have the right to purchase an additional number of shares from eBay in the newly privatized Adevinta, which would reduce eBay’s ownership position to approximately 9.99%. “If this right is exercised by Permira, Blackstone and their co-investors, the purchase price for those additional shares would be the same price paid to eBay for its Adevinta shares at closing and would represent proceeds in excess of $1 billion,” eBay stated in Tuesday’s press release.
General Corporate Purposes = Raises for the elite.
Wine, dine and pocket line …. Same San Jose Mafia as always…..