eBay looks to offload German classifieds business
27 March 2019
27 March 2019
German classifieds business Scout24 is looking to further its portfolio with the potential acquisition of eBay owned rival mobile.de.
The car advertising portal hopes that an upcoming takeover by financial investors will give them the opportunity to buy its rival. The classifieds division of the US industry giant eBay, which includes the largest German car portal, is ′a concrete example of what we could imagine,’ said the new Scout24 CEO Tobias Hartmann.
eBay is looking to offload its classifieds business following pressure from activist investors to do so. The company has informed investor Elliott Management Corp that it is willing to explore shedding some assets and give the hedge fund board representation in a bid to avert a proxy contest, people familiar with the matter said last month.
Elliott has estimated that eBay’s entire classifieds business would be worth between $8 billion and $12 billion (€7.1 billion and €10.6 billion) if it were spun off.
Any deal between Scout24 and mobile.de would be subject to antitrust investigations. Such a deal would depend on how broadly the watchdog defines the market following the entry of new market players.
Scout24 is itself the target of a €5.7 billion friendly takeover by private equity firms Hellman & Friedman and Blackstone amid churn in the classifieds sector as players seek scale. CFO Christian Gisy said Scout24 expected a formal offer from the private-equity buyers within days, with the market expecting the deal to go through.
However, Scout24 might have a fight on their hands, with reports suggesting that one of Europe’s biggest publishing companies, Axel Springer, is also interested in eBay’s business. ′It’s clear we’re interested,’ an Axel Springer source told the German business magazine Capital. Industry observers suggest the company would team up with a financial investor as it has in past deals.
While eBay is offloading its German classifieds business, in the UK it is expanding its portfolio. The company announced in February that it had completed the acquisition of Cox Automotive’s Motors.co.uk classifieds business.
This followed the earlier integration of Gumtree Motors with eBay in January 2018. The company has seen the online vehicle classifieds market as a lucrative business opportunity and can now bring all three of its online shops together to provide a wide-ranging platform for used car sales through the internet.
When Gumtree and eBay came together as one business, the joint offering claimed to be the fastest-growing classifieds marketplace for cars in the UK. Six million users a month visit the site’s Motors offering whereas 3.7 million users a month visit eBay to look for a new car.