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Adevinta, eBay clear final hurdle in $13 bln advertising tie-up

2 minute read

The eBay logo is pictured on a screen in this photo illustration in New York, U.S., July 23, 2019. REUTERS/Brendan McDermid/Illustration

  • Austrian competition authority OKs deal
  • Firms will form world's No. 1 classified ads group
  • Transaction worth $13 bln at current share price
  • EBay must cut Adevinta stake to no more than 33%

OSLO, June 18 (Reuters) - U.S. e-commerce group eBay (EBAY.O) and Norway’s Adevinta (ADEV.OL) have secured final regulatory approval for a tie-up of their global classified ads businesses, the Norwegian firm said on Friday.

Under a deal struck last year, Adevinta will acquire eBay's Classifieds Group in return for $2.5 billion in cash and 540 million shares, valuing the transaction at around $13 billion at current stock market prices.

The final regulatory approval came from the Austrian competition watchdog after eBay agreed to reduce its ownership stake in Adevinta during the next 18 months, the Norwegian firm said.

The compromise removes the sole outstanding obstacle to the deal following a go-ahead from Britain's Competition and Markets Authority earlier this month. read more

"Adevinta is pleased to announce that closing of the transaction will be initiated shortly and is expected to complete on or about 25 June," the Oslo-listed company said in a statement.

The transaction makes eBay Adevinta's largest shareholder with an overall 44% stake and 33.3% of the vote, and gives the U.S. firm two seats on the company's board. Norway's Schibsted (SBSTA.OL) will hold around 39.5% of the votes.

But as part of the deal with Austria's Federal Competition Authority (FCA), eBay must reduce its financial interest in Adevinta to no more than 33% within 18 months of the transaction's closing, Adevinta said.

"The remedies proposed by Adevinta and eBay address the FCA's concern that the transaction could potentially lessen competition in the Austrian market," the company said.

Adevinta's shares were up 2.0% to 165.7 Norwegian crowns at 0917 GMT.

As part of the overall deal, Schibsted will buy eBay Classifieds Group’s Danish assets from Adevinta for $330 million.

Reporting by Terje Solsvik, editing by Gwladys Fouche

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