eBay’s classifieds auction sustains strategic interest amid Covid-19 uncertainty – sources

06 May 2020 - 12:00 am UTC

eBay’s classifieds division is still attracting interest from parties including Adevinta , the Norwegian digital classified business spun off from Schibsted, and German classifieds and media group, Axel Springer, despite coronavirus-related market turbulence, according to four sources familiar with the matter. 
The deadline for the next round is in a couple of weeks, three of the sources said. This round will not be binding, with confirmatory offers and valuation work taking place after the deadline, two of these sources added.  
Adevinta is likely to propose a Reverse Morris Trust transaction, which would combine a spin-off of the classifieds division and a merger with Adevinta, creating a US entity, three of the sources said. This structure could avoid triggering a tax charge to eBay on disposal of the assets and to shareholders receiving shares in the new entity.  Under that structure, eBay shareholders can gain from potential synergies and any upside in the unit over time, the sources said.  
Adevinta, however, is also considering alternative options, one of the sources said.  
Naspers’ Dutch-listed vehicle Prosus and Autoscout24, backed by Hellman & Friedman, are also vying for the asset after being admitted to the next stage of the process following indicative bids in March, the sources added.  
Prosus is well-backed and would likely make an all-cash offer, three of the sources said. Axel Springer, controlled by KKR and CPPIB, is also in a good position to make an offer, one of them added. Meanwhile, AutoScout, the former car trading business of Scout24, could face competition hurdles in acquiring the classifieds division, given overlaps with eBay’s rival car advertising portal Mobile.de in Germany, two of the sources said.   
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