EBay closes in on South Korean auction house

EBay looks set to complete the purchase of an online auction business in South Korea.

EBay looks set to complete the purchase of an online auction business in South Korea.

On Thursday it filed a tender offer to acquire the remaining shares of Internet Auction (IAC) that it does not already own, in a deal valued at about $4m (£2.23m).

The auction house already owns more than 97% of IAC's outstanding shares, many of which it recently acquired from institutional investors in on-the-market block purchases.

Last week it announced that it had agreed to buy almost three million shares from institutional investors for about $325m.

EBay wants to increase its control of IAC by acquiring the remaining 378,691 outstanding shares for KRW125,000 (South Korean Won) a share, which would total about $41m based on Wednesday's exchange rate, it said.

There is no minimum number of shares required to be tendered so eBay said it will purchase any shares tendered at this price.

EBay said that it plans to have IAC voluntarily delist its shares from trading on the Kosdaq exchange in accordance with legal and regulatory guidelines.

The company added that it does not expect the transaction to affect its financial guidance for the third quarter of 2004.

Although already an auction leader in North America and Europe, eBay faces stiff competition in Asia from Yahoo, which has recently been moving to strengthen its presence in the region.

Scarlet Pruitt writes for IDG News Service


Read more on E-commerce technology