eBay, Inc., san American e-commerce company, has entered into a deal worth $ 4.05 billion with its rival, Viagogo.
The company announced to sell its online ticketing subsidiary to StubHub, a Swiss-based reseller, Viagogo on November 25, 2019. StubHub was acquired by eBay for $ 310 million in 2007.
Selling of StubHub; A New Strategy
Since last year, eBay has been facing a low annual turnover. Despite the gross annual revenue of eBay had reached around $ 4.8 billion in 2018, the annual turnover of StubHub reduced to 5% in the last year.
Post the resignation of the former CEO, Devin Wenig in September 2019, the company has been closely working with the representatives from its key investor, Elliott and Starboard Value.
The decision of selling StubHub is a result of the investor’s pressure on eBay, as a part of a new strategy for e-commerce marketing. Recently, eBay lost its presence in the market, as the rival companies including Amazon and Shopify gained their grounds significantly.
The President of StubHub, Sukhinder Singh Cassidy expressed,
“Bringing StubHub and Viagogo together will allow us to drive further expansion and innovation, and create a more competitive offering for live event fans globally, which provides a great opportunity to expand our business, pursue new partnerships and execute our strategy. We expect a seamless transition for all our employees, partners and customers, and we are excited for what the future holds.”
Viagogo’s Expansion of E-Commerce Services
Viagogo is a major e-commerce site, which deals with selling tickets for live sport, music, and entertainment events.
The company recently faced troubled as the Competition and Markets Authority’s (CMA) complained against the way Viagogo handled the buying and selling of “second-hand tickets” business.
The company has been targeted for violating consumer laws. However, in September 2019, the CMA consented that the company had addressed the existing problems.
Viagogo’s CEO, Eric Baker, stated, “It has long been my wish to unite the two companies; the combination would offer greater choice for ticket buyers and give sellers access to a larger marketplace”.
The deal for acquiring StubHub is likely to be settled in the first quarter of 2020. Until then, the two companies will be working separately.
This is a major opportunity for Viagogo to expand its e-commerce ticketing business across the globe. According to Scott Schenkel, eBay’s interim CEO, “This transaction is a great outcome and maximizes long-term value for eBay shareholders”.
I’m Roshan, a journalist, blogger and music lover. I like covering global news related to finance, business, and technology. Focusing on the collection of true and reliable information, I rely on working by conducting interviews with business leaders and talking to the inside sources of companies.
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