EBay Inc. (NASDAQ: EBAY ) has announced its intentions to sell its StubHub ticketing platform to Swiss ticket vendor Viagogo for $4.05 billion in cash. The sale is expected to close by the end of the first quarter, subject to regulatory approval and customary conditions. EBay interim CEO Scott Schenkel said in a press release that the transaction “maximizes long-term value for eBay shareholders” and that this was the “best path forward for both eBay and StubHub.”
EBay has owned StubHub since buying the company in 2007 for $310 million. As of Q3, StubHub drove $306 million in revenue and gross merchandise volume of $1.2 billion. The plan to sell off StubHub was initially sparked by activist investors, Elliott Management Corp. and Starboard Value LP. Reports began to emerge last July that eBay was moving forward with a potential sale of StubHub.
The sale to Viagogo creates an interesting circle that swirls back around to Viagogo CEO Eric Baker. Baker co-founded StubHub 19 years ago while in business school, but left before the sale to eBay because of “differences” with his partner. Baker said in a statement, “It has long been my wish to unite the two companies. I am so proud of how StubHub has grown over the years and excited about the possibilities for our shared future. Buyers will have a wider choice of tickets, and sellers will have a wider network of buyers.”
According to the news release, the combined entity is expected to sell hundreds of thousands of tickets across over 70 countries for live, sport, music, and entertainment events. The companies are expected to operate independently for some time while executives research the best way to integrate the businesses. No leadership changes are planned, according to the companies. It is not clear how the company will pay the $4.05 billion cash price tag. Viagogo currently has committed debt financing from J.P. Morgan.