rose today on news reports that the online-auction site is making another move in its bid for world domination.
Wall Street Journal
story today stated that San Jose, Calif.-based eBay was in "advanced negotiations" to buy leading French auction site
for $92 million.
Shares of eBay lifted on the report, closing up $2.63, or 5.9%, to $47.19.
"I think it's a good plan. Their goal is to be No. 1 in the world. At their valuation relative to their competitors, they are in a position to execute," said
analyst Kevin Silverman. Silverman rates eBay a buy, and ABN Amro has not done underwriting for the company.
The auction site is making its international moves at the right time -- when its targets are still small and inexpensive for the company, which has a
market cap of more than $12.6 billion.
Henry Blodget wrote today that the move was "positive and consistent with eBay's acquisition strategy of acquiring leading players in promising international markets." Blodget has an accumulate rating on eBay, and Merrill Lynch has not done recent underwriting for the company.
Last month, eBay purchased a majority share of
Internet Auction Co.
, Korea's leading online auction site, for a reported $120 million in cash.
In 1999, it bought the German auction site
for a reported $14 million, turning it into
Buying iBazar would entrench eBay deeper into the European market, where it competes with London-based
analysts Jeetil Patel and Neil McCluskey wrote that iBazar would make eBay a significant presence in eight European countries, and the leading auction site in France and Italy. The analysts wrote that iBazar ranks second in the number of unique visitors among French e-commerce sites.
The deal isn't likely to bring revenue immediately because iBazar has a free listing policy. Deutsche Banc rates eBay a buy and has done recent underwriting for the company.
One thing eBay might get if the deal goes through is its domain name in France. Apparently, the managing director of iBazar owns the domain name
and has won the rights to it in a court decision. eBay is forced to do business there as