Ebay has agreed to sell its classified ads business to Norwegian group Adevinta in a deal worth $9.2 billion, creating the world's largest classified ads group, the companies said on Tuesday.
Ebay will receive $2.5 billion in cash and 540 million shares of Adevinta, making it the largest shareholder with a 44%stake of the pro forma company, they said.
"Adevinta becomes the largest online classifieds company globally, with a unique portfolio of leading marketplace brands," Adevinta CEO Rolv Erik Ryssdal said.
The company will have market presence in 20 countries, covering one billion people with three billion visits every month.
"We believe the combination of the two companies, with their complementary businesses, creates one of the most exciting and compelling equity stories in the online classifieds sector," Ryssdal said.
Adevinta was spun out of Nordic media company Schibsted and listed on the Oslo bourse last year.
Its shares jumped 39% on the news after trading that had been halted resumed while Schibsted shares were up 21%.
It owns brands such as Leboncoin, France's biggest online classified ads website, Brazil's OLX and dozens more across Europe, the Americas and North Africa.
The eBay Classifieds Group includes the Gumtree and Kijiji brands, and offers online ads to more than 1,000 cities around the world. The business posted an operating income of $83 million on revenue of $248 million in the first quarter of 2020.
The transaction, which is expected to close by the first quarter of 2021, targets $150-185 million in annual synergies within three years.
It will mean Schibsted's stake in Adevinta falls to about 33% from 59%, Schibsted said separately.