NEW YORK: Online auction firm eBay Inc. is buying San Francisco-based StubHub, a sports ticket reseller, for an estimated $310 million.
Announcing the deal in a statement, eBay said the all-cash transaction is expected to close in the first quarter of 2007, subject to approvals by StubHub's shareholders and regulators. The deal includes StubHub's net cash at the time of the deal's closing.
Founded in 2000, StubHub is one of eBay's competitors. It had crossed $400 million in gross ticket sales in 2006. eBay had made an attempt to buy the firm in 2002 for around $20 million, but could not agree on the price.
StubHub provides a secure method of buying and selling tickets offering money-back guarantee so that buyers do not lose out on unused tickets. It acts as middleman ensuring privacy of the buyers.
The company had raised a first round of funding of $2.1 million in 2001 and it had subsequently received additional funding in subsequent rounds, which has not been disclosed.
Bill Cobb, president of eBay's North America Marketplaces said StubHub has been extremely successful in the online tickets segment and it is a perfect complement to eBay's tickets segment.
StubHub's founder and chief executive Jeff Fluhr said his company's business model is an excellent fit with eBay. StubHub exists to serve passionate fans, he said, and added the deal will benefit them as they will be able to use the power of eBay and its community of users.
