eBay and Adevinta to sell Shpock, Gumtree in UK to satisfy competition watchdog
eBay and Adevinta said on Tuesday that the’ve reached an agreement that will satisfy the UK's competition watchdog over their planned megadeal for their classifieds businesses.
The original plan had been for eBay to sell Gumtree to Norway-based international classifieds website Adevinta ASA. But eBay would also acquire a 33.3% voting stake in Adevinta and seats on its board and would therefore be able to influence decision-making for both Gumtree and the Norwegian firm's Shpock site.
That’s why the UK’s Competition and Markets Authority (CMA) said it had “concerns that the proposed transaction could reduce competition” in Britain.
The result is that they will sell “each company's primary classifieds operations in the UK”. That means Adevinta’s Shpock business and eBay’s Gumtree (UK) and Motors.co.uk.
Shpock in particular is a big forum for people to sell used fashion items. But in 2019, eBay Classifieds Group's UK business accounted for less than 10% of its consolidated revenues and Adevinta's UK business accounted for only 1% of its consolidated revenues. On a combined basis, the UK would represent less than 5% of total consolidated revenues.
That problem dealt with, the two companies are now targeting Q2 as a closing date for the transaction, subject to final ratification of the remedies execution plan by the CMA and receipt of outstanding regulatory approval in Austria.
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