eBay buying StubHub for $300 million -- probably

Posted Jan 10th 2007 6:45PM by Melly Alazraki
Filed under: After the Bell, Deals, Rumors, Competitive Strategy, eBay (EBAY)

Rumors have been floating on for a while and today we are informed -- again -- that eBay Inc. (NASDAQ:EBAY) is on the verge of buying StubHub Inc. for some $300 million in cash. That's according to sources.

BloggingStock's Gary E. Sattler wrote about StubHub back in November, giving a little more in-depth look into the online ticket reseller. The company boasted a 3000% growth rate from 2002 to 2005 and was mentioned among the 10 fastest growing private companies in America on Inc. Magazine's annual "Inc. 500" list.

The official announcement could come tonight or tomorrow according to sources that AP and Reuters quote.

Ticket sales on StubHub were more than $400 million in 2006, generating more than $100 million in revenue. Sellers pay a 15% fee while the buyers are charged a 10% commission.

This isn't the first time eBay is trying to buy StubHub. In 2002 the price tag was $20 million, but negotiations fell apart.

With the U.S. secondary ticket market having a turnover of about $10 billion a year, eBay is wise to buy out the competition to get a bigger piece of the pie.

eBay shares closed at $29.30 today, down $0.45 or 1.51%.

Tags: ebay, stubhub

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Reader Comments (Page 1 of 1)

1-10-2007 @ 9:31PM

Randy Smythe said...

Its a done deal. eBay is buying StubHub for $310 Million. Here is the press release.

http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20070110006144&newsLang=en

1-10-2007 @ 11:08PM

online auction said...

I don't get it?! How is this good for eBay? This is not even an auction site.

1-11-2007 @ 12:49AM

Gary E. Sattler said...

If it's true, this is a good move by eBay. They can slide ticket sales off the main auction site, provide some system relief, eliminate a competitor and concentrate ticket buyers and sellers into a dedicated forum. I really like this.

This is a good and profitable move. Let's hope the rational thinking doesn't stop here.

1-11-2007 @ 9:13AM

DD said...

I agree with you, Gary.

My greatest concern is that StubHub may have fallen into the wrong management hands.

What a shame if this buy runs the dog course of Skype.

Fingers and toes crossed.