EBAY IS BIDDING goodbye to over 10 per cent of its global workforce, as the online auction firm admitted its third quarter results would not be looking great.
But whilst the company was busy laying off 1,000 members of full time staff and hundreds of temps – a move which will cost between $70 and $80 million – Ebay has apparently found enough spare change under the couch to buy three more companies.
Ebay shelled out $820 million in cash and $125 million in outstanding options for credit firm Bill Me Later and a further $390 million in cash for Danish classifieds specialist Den Bla Avis and car classified ad site BilBasen.
The online auction giant says it already has an online classified presence spanning 20 countries, including Canada, Australia, Germany and Japan. So why not spread some love to Danish classifieds too?
As for Bill Me Later, Ebay CEO and president John Donahoe reckons not only is it "a perfect complement" to his company’s portfolio, but that it’s also Paypal’s long lost brother and soul mate.
Ebay’s new credit firm will give punters instant online shopping credit through a "sophisticated underwriting technique and credit decision model", allowing them to pay off bills at a later date by cheque. Ebay hopes this will help lure in more buyers worried about using their credit cards online, or spending money they don’t actually have. The firm says it expects to extort... er, generate $150 million in revenue with it by next year.
Ebay had better hope its new acquisitions start pulling their weight rapidly, the firm has warned its third quarter results - to be released October 15th – will probably be hitting the bottom end of sales targets.
Commenting on his firm’s difficulties and having to lay off a tenth of its workforce, Donahoe noted the reductions would "help improve our operations and strengthen our ability to continue investing in growth."
We know what we’d be saying if we were laid off Ebay workers reading about all these new acquisitions as we shuffled down to the jobs centre... "grow to hell". µ
Ebay's SEC filing
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