Summary
eBay Inc. announced on September 1, 2009, a significant divestiture by agreeing to sell its wholly owned subsidiary, Skype, for approximately $2.75 billion. The transaction involves selling the share capital of various Skype entities to an investment group led by Silver Lake, which includes the Canada Pension Plan Investment Board, Index Ventures, and Andreessen Horowitz. This strategic move will result in eBay receiving approximately $1.9 billion in cash at closing, along with a $125 million subordinated note and a 35% equity stake in the buyer. The sale is expected to close in the fourth quarter of 2009, subject to customary closing conditions, including regulatory approvals and the absence of material adverse effects on the Skype Companies. The transaction represents a substantial monetization of eBay's investment in Skype, allowing the company to focus on its core businesses.
Key Highlights
- 1eBay Inc. is selling its entire stake in the Skype Companies for approximately $2.75 billion.
- 2The buyer is an investment group led by Silver Lake, including CPP Investment Board, Index Ventures, and Andreessen Horowitz.
- 3eBay expects to receive $1.9 billion in cash at closing, subject to adjustments.
- 4eBay will also receive a $125 million subordinated note and a 35% equity stake in the acquiring entity.
- 5The transaction is expected to close in the fourth quarter of 2009.
- 6Closing is contingent on various conditions, including antitrust approvals and no material adverse changes to Skype.
- 7Marc L. Andreessen, an eBay board member, is a partner at Andreessen Horowitz, a member of the buyer group, but will own less than 5% of the buyer.