4 ms·
Hold on - did Ebay just score a win with this?
by hessenwolf 15y ago
Hold on - did Ebay just score a win with this?
- gwern 15y agoMaybe; eBay paid $2.6b in ~2005 (OP says 3.1b, WP says $2.6b), and then sold off 70% of it for $2b (http://en.wikipedia.org/wiki/Skype#History http://en.wikipedia.org/wiki/Skype#History). OP doesn't seem to specify how much MS is buying, but let's assume 100%, so eBay is selling its 30% too; 30% of 8.5b is $2.55b, so eBay sold its 2 chunks for 2+2.55 or $4.55b. That represents a profit of 1.45 or 1.95b over 6 years or $320m a year. (If MS didn't buy eBay's share, then they are currently at a 0.6-1.1b loss on their Skype investment excluding whatever that 30% is worth.) Presumably eBay had better opportunities for 2-3b of capital.
- hessenwolf 15y agoThank you. I wouldn't presume Ebay had better uses for the capital though. Skype has clearly had a faster rate of growth than Ebay. (although, paying an effing dividend would in my personal opinion be better than maintaining a thirty percent share of a telephone company)