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eBay and GSI Commerce Make it Official (For $2.4 Billion)

eBay Significantly Boosts E-Commerce Offerings

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eBay and GSI Commerce Make it Official (For $2.4 Billion)
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eBay announced today that it has completed its acquisition of GSI Commerce, which was announced back in March. The deal was approved by stockholders on the 17th.

eBay acquired all outstanding shares of GSI at $29.25 pher share in cash, adding up to about $2.4 billion.

GSI Commerce will continue to operate as a separate business from eBay, and will be led by Chris Saridakis as its newly appointed president. He will report directly to John Donahoe, eBay’s President and CEO.

“We intend to lead the next generation of commerce innovation,” Donahoe said when the deal was first announced. “The acquisition of GSI, which offers the most comprehensive integrated suite of online commerce and interactive marketing services available, will significantly strengthen our ability to connect buyers and sellers worldwide. Combined with eBay Marketplaces and PayPal, we believe GSI will enhance our position as the leading strategic global commerce partner of choice for retailers and brands of all sizes.”

“While those are longer range goals that the combined companies are fast at work on – coming in today there was a noticeable difference already,” GSI’s Jose Mallabo said today on the GSI Commerce blog (also providing the following pictures. ” For the people sitting at the King of Prussia headquarters of GSI you didn’t have to read the release or this post to know the deal closed – you just needed to look up as you walked in.”

GSI, eBay join forces

Some think the deal is key in eBay’s competition with Amazon in e-commerce, as GSI powers an impressive list of clients‘ e-commerce offerings. Clients include major brand like Adidas, Calvin Klein, Nautica, Levi’s, Toys “R” Us, HP, NFL, NBA, MLB, NASCAR, ESPN, Dick’s Sporting Goods, and many more.

In March, we ran an article from Rob Diana, who said, “This is the easiest way for eBay to get into ecommerce for larger brands without affecting their auction business. They get a known name in ecommerce and an excellent client list. In addition, they also get the warehouses and distribution facilities that GSI  manages for some of their clients. Yes, they have warehouses which contain either merchandise for their clients or merchandise that they own and sell through their clients stores.”

“This combination of things could make a huge business for eBay,” he continued. “In order to see why this is a good idea, you have to think of the possibilities. There is the obvious ability to start hosting major ecommerce brands. However, the other parts of the deal really make it interesting. eBay has its own auction site. Match auctions with “discount” items from the merchandise their clients sell and warehouses to distribute from. Very quickly, eBay could become an even larger player in the discount and used merchandise niche because they would own some of the product. Or they could enable the client stores to hook into the eBay auctions so that they can have their own outlet store and auctions.”

eBay completed the divesture of GSI’s licensed sports merchandise business and 70% of its ShopRunner and Rue La La businesses to a newly formed holding company led by GSI founder and former CEO Michael Rubin.

eBay and GSI Commerce Make it Official (For $2.4 Billion)
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  • Philip Cohen

    eBay, Magento, AliExpress, Skype, Fish, FigCard, GSI Commerce, RedLaser, Where, Milo, Fetch, PayPal, Google, Schmoogle, whatever …

    eBay’s chief headless turkey likes buying toys, none of which have done anything to improve the eBay Marketplace’s bottom line, not even in this the fourth year of his three-year turnaround.

    The fact is the rusting old hulk eBay is presently being kept afloat by the clunky PreyPal so it’s good to see these boys recently squabbling and threats to PreyPal’s online dominance now coming thick and fast. It’s interesting times ahead for all we eBay “haters” (oops, I mean “watchers”). I just hope that someone has remembered to bring the popcorn.

    PayPal is mostly registered in various places not as a “bank” or as a provider of credit but only as a “money transmitter” (like Western Union), and PayPal actually claims that they are not a “payment network”, and there is a minute degree of truth in that claim because it could, somewhat nonsensically, be claimed that they do no more than facilitate the transmission of money by riding on the back of the banks’ existing payments processing systems.

    In fact, the only thing creative about PayPal has been their use of users’ email addresses as an identifier for online payment transactions. PayPal is otherwise no more than a blood-sucking parasite on, and in the main cannot function except via, the banks’ existing payments processing systems which they access via their banker, GE Money Bank—Ugh!

    PayPal, outside of whatever will ultimately be left of the Donahoe-devastated eBay Marketplace, will undoubtedly eventually be consigned to the history books by the retail banks/Visa/Mastercard once those players get their “online” act together.

    Some people may not like “the banks” but all those participating retail banks at least supply a professionally run payments processing system—unlike PayPal’s—and even PayPal concurs with that assessment: except for intra PayPal “account” transactions, they use the banks’ payments processing systems all the time and simply could not exist without them.

    Regardless, all the above comments apply equally to all of the other third-party online “payments processors” that are emerging out of the woodwork and wanting to have access to your banking account. Unless they have formal and direct arrangements with all the participating retail banks, as do the likes of Visa/MasterCard, then the result is invariably going to be as potentially problematic as is PayPal’s clunky operation for its merchants—many of whom can tell you a sorry tale or two.

    What you should know about the clunky PayPal, at:
    http://forums.auctionbytes.com/vbulletin/showthread.php?p=165263

    What you should know about the criminal activities of eBay, at:
    http://forums.auctionbytes.com/vbulletin/showthread.php?t=23540

    Is that PayPal’s blood in the water, and are those “sharks”—oops, “banks”—I can see circling?

    Enron / eBay / PayPal / Donahoe: Dead Men Walking.