Another loose end tied up for eBay. The company, which has been readying itself for its split with PayPal Holdings, has agreed to sell its Enterprise to a group led by the private equity firm Permira for $925 million.
EBay Enterprise, which manages online operations for clients such as IKEA and the National Basketball Association, has had a tough time of late. Toys "R" Us recently announced it was transitioning away from the company to manage its own site beginning next year. Dick's Sporting Goods will join the list of former customers of eBay Enterprise in early 2017.
Modest growth and recent account losses factored into the final selling price. The business, which was previously named GSI Commerce, was acquired by eBay in 2011 for $2.4 billion. According to The Wall Street Journal, eBay Enterprise generated $1.24 billion in revenue last year, a six percent increase over the previous year.
The deal is expected to allow eBay to focus on its core marketplace business following its split with PayPal.
In an earning call with analysts yesterday, eBay CEO designee Devin Wenig said the company was focused on "building a more robust commerce platform" for its marketplace customers and sellers.
Image: eBay Enterprise
"Our primary effort in this area is focused around leveraging structured data to drive discoverability both on and off our marketplace, as well as improving the user experience," said Mr. Wenig (via SeekingAlpha). "This is a long-term effort and our rollout is initially focused on categories where we have a predominance of manufactured goods. On June 29, we started to require that our sellers provide product identifiers where relevant when listing an item. This is enabling us to create innovative new browse and product pages, which were not previously possible in our marketplace."
Mr. Wenig also said eBay was investing in growing marketplace traffic through social channels, specifically Facebook and Pinterest. He also mentioned the company is looking to leverage others, including Instagram, Periscope, Snapchat and Tumblr.
"We view social media and messaging platforms as a great way to reach our customers in the places they love, while allowing us to diversify our sources of traffic and user acquisition for consistent long-term growth," he said.
Mr. Wenig said eBay was improving its mobile capabilities and planned to launch "a new experience" in the second half of the year.
- eBay John J. Donahoe on Q2 2015 Results (Earnings Call Transcript) - SeekingAlpha
- EBay sells enterprise unit ahead of PayPal split - Reuters
- EBay's Enterprise Unit Takes a Hit Amid Sale Talks - The Wall Street Journal (sub. required)
- Is Toys 'R' Us ready to manage its websites in-house? - RetailWire