The biggest online auction site, Ebay, has announced the acquisition of the e-commerce brand, GSI Commerce. With this buyout Ebay aims to improve its ability to connect buyers and sellers. The company has paid $2.4bn ($2,400 million), which is $29.25 per share, an increase of 51% over GSI’s closing share price last week.
With this move, Ebay aims to reach Amazon, trying to become a platform for third-party sellers (retailers), because Amazon has a larger distribution network. GSI handles the e-commerce activities for large brands and retailers, including well known brands like Ralph Lauren, Toys R Us and the National Football League.
“The acquisition of GSI, which offers the most comprehensive integrated suite of online commerce and interactive marketing services available, will significantly strengthen our ability to connect buyers and sellers worldwide,” said John Donahoe, eBay’s chief executive.This deal has been Ebay’s largest in North America since 2005, when it acquired Skype. Ebay shares have fallen 2.8% to $30.80 in the US Stock Exchange this morning, while GSI’s stock climbed to $29.18, an increase of more than 50%.
Ebay has also experienced an increase in its reliance because of the Paypal online payments service, which is a safe and fast way to pay within Internet.
On the other hand, I think it will let ebay increase its monopoly on internet auctions, so it will rise it's commissions, and as a result users will earn less money for their auctions. They will not be able to do anything because ebay it's the internet auction leader by far, with the most potential buyers looking for any of the products you might want to sell.
Carles Urpí
Source:
Carles Urpí
Source:
Great Carles, well written.
ResponEliminaWatch:
action --> share
Ebay pretends to --> aims to (pretend is a false friend)
it will rise its commissions --> its commissions will rise / it will raise it's commissions.