Financial Daily from THE HINDU group of publications
Wednesday, Jan 07, 2004
Marketing - Online Marketing
Info-Tech - Mergers & Acquisitions
eBay bids for Indian foray with Baazee buy?
Bangalore , Jan. 6
THE world's largest person-to-person trading community on the Internet eBay Inc is eyeing local online auctioneer Baazee.com for a possible buy-out in its bid to foray into India.
Informed sources said both the companies had a few round of talks on the possible transaction.
When contacted, the Baazee's Chief Executive Officer, Mr Avnish Bajaj, chose not to comment.
"Our policy is not to comment on speculation... we are not in position to comment at all," he said. The eBay Chief Executive, Ms Meg Whitman, has recently gone on record saying the company was in talks with an Indian firm for a possible entry into the country.
eBay, which sold goods worth $20 billion on the Net last year, is expected to report revenues of $3 billion by 2005. Baazee.com India Pvt Ltd is a subsidiary of the New York-based Baazee.com and started its operations in India January 2000. The company has 2.6 million registered users, who trade on a diverse product portfolio on its Web site.
Mr Rupert Murdoch's STAR is a strategic partner in Baazee with an investment of $11 million along with Chrysallis Capital Venture, ICICI Ventures and steel baron Mr L.N. Mittal.
A STAR official did not respond to a query on its possible exit from Baazee through a stake sell out.
eBay, which recently started its Hong Kong operation, could well be interested in tapping the huge potential of the Indian economy, whose impressive growth is boosted by the increasing tech-savvy population with large disposable income.
It can be noted that eBay usually spreads in new markets through buying out "baby eBay's" or local companies who imitate eBay's business model.
The global online auction leader is currently on an expansion drive across Europe and Asia.
In the last analyst meet at eBay's headquarters in California, the company highlighted its three-tiered growth dynamics: acquisition, activation and activity.
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