eBay Inc. (NASDAQ:EBAY) today announced two acquisitions that
significantly extend the company’s leadership
position in online payments and classifieds. In payments, the company is
acquiring the U.S.-based online payments business Bill Me Later®
for approximately $820 million in cash and approximately $125 million in
outstanding options. In classifieds, the company has acquired Denmark’s
leading online classifieds site dba.dk and vehicles site bilbasen.dk for
approximately $390 million in cash.
The company also announced plans to reduce its global workforce by
approximately 10 percent, affecting about 1,000 employees in addition to
several hundred temporary workers and the reduction of open positions.
The global reduction is intended to simplify and streamline eBay’s
organization, improve the company’s cost
structure and strengthen the overall competitiveness of the company’s
existing businesses. The reduction is expected to result in pretax
restructuring charges of approximately $70 million to $80 million, with
the charges predominantly recorded in the fourth quarter of 2008.
“We are making aggressive moves to strengthen
our leadership positions in e-commerce and payments to competitively
position our company for long-term growth,”
said John Donahoe, eBay Inc.’s president and
chief executive officer. “Bill Me Later is a
perfect complement to our portfolio, a company that belongs with PayPal.
Together, PayPal and Bill Me Later will make online payments safer,
easier and more convenient than ever.”
“Our classifieds acquisition gives us another
market leadership position in Europe for this rapidly growing part of
our portfolio,” Donahoe said. “We
are the global leader in classifieds with top positions in Canada,
Australia, Germany, Japan and the United Kingdom, and sites in more than
1,000 cities across 20 countries. The acquisition of dba.dk and
bilbasen.dk gives us technology and expertise we can leverage across our
classifieds portfolio to create better customer experiences.”
Commenting on the company’s workforce
reduction, Donahoe said: “While never an easy
decision to make, these reductions will help improve our operations and
strengthen our ability to continue investing in growth.”
The company also stated it expects to hit the low end of its Q3 2008
revenue guidance and exceed GAAP and non-GAAP earnings per share
guidance as issued in conjunction with its second quarter earnings
release on July 16.
