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By Cara Lombardo and Corrie Driebusch
EBay Inc. reached a deal to sell its StubHub ticketing business to Swiss ticket reseller Viagogo Entertainment Inc. for $4.05 billion in cash.
EBay has owned StubHub since 2007 when it bought the business for $310 million. StubHub, one of the most popular platforms to buy and sell tickets to concerts, sports and other events, accounted for about 14% of the company's revenue in the third quarter.
Geneva, Switzerland-based Viagogo is an online marketplace for the resale of live sports, music and entertainment tickets. While both companies engage in ticket resale, Viagogo is a significant player internationally, while StubHub is mostly present in the U.S.
The deal was reported earlier by The Wall Street Journal and will reunite closely held Viagogo's Chief Executive Eric Baker with StubHub, a company he co-founded.
EBay decided to explore selling StubHub shortly after two activist investors surfaced in January and urged it to exit businesses unrelated to its core marketplace. The company agreed to consider selling StubHub and its internationally focused Classified business. It also added board members as part of its settlement with Elliott Management Corp. and Starboard Value LP.
Elliott had said it believed StubHub could sell for between $3.5 billion and $4.5 billion and eBay's classified businesses for between $8 billion and $12 billion.
In September, eBay CEO Devin Wenig stepped down from the company, in part because of disagreement over selling StubHub and the classifieds business.
EBay in October warned investors it could report its first quarterly revenue decline in four years. The company also said sluggish sales of merchandise through its main platform helped cause a 57% year-over-year decline in its third-quarter profit.
EBay has been working for years to redefine itself as shoppers increasingly turn to their phones, showing little patience for scrolling through thousands of listings. The company touts that 80% of items on its site are new, with the bulk sold at a fixed price rather than being auctioned. It has rolled out improved search features and personalized recommendations and reviews. It also recently launched aggressive marketing campaigns to shed what some see as its outdated image.
Write to Cara Lombardo at firstname.lastname@example.org and Corrie Driebusch at email@example.com
(END) Dow Jones Newswires
November 25, 2019 10:01 ET (15:01 GMT)
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