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eBay to sell 65% of Skype to private investors
TT Bureau |  |  02 Sep 2009

eBay Inc. is planning to sell 65 percent of its stake in its internet-calling unit Skype to private investors including Silver Lake.

 

The deal, which has valued Skype at $2.75 billion, will offer eBay $1.9 billion in cash and a $125 million note, the company said in a statement today.

 

With the sale of a majority stake in Skype, eBay aims to lessen its dependence on a unit that Chief Executive Officer John Donahoe has said doesn’t fit with the rest of eBay’s operations.

 

Further, it also aims to focus on its auction service and its PayPal electronic payments service and avoid the potential risks of the initial public offering it has scheduled for Skype for next year.

 

Other investors in the group comprise of Andreessen Horowitz, a venture-capital firm headed by Internet pioneer Marc Andreessen; Index Ventures, a firm that invested in Skype before eBay bought it; and Canada Pension Plan Investment Board, which invested $300 million.

 

eBay, based in San Jose, California, acquired Skype in 2005, outbidding Google and Yahoo in a deal and had about 405 million registered users at the end of 2008.

 

About two years after the transaction, eBay made a $500 million payout for the founders on top of the $2.6 billion it paid for the company in 2005. It also wrote down about $1.4 billion off the value of its investment as it conceded that the telephony unit does not fit with eBay'''s other businesses.

    
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02 Sep 2009(IST)  
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