EBay to buy GSI Commerce for $2.4B

The deal is expected to boost eBay's e-commerce and online payment services

EBay has agreed to acquire for about $US2.4 billion GSI Commerce, whose suite of e-commerce and digital marketing tools and services are expected to boost eBay's online marketplace and PayPal e-payment businesses.

EBay has offered to pay $29.25 per share and expects the deal to close in this year's third quarter, after obtaining regulatory and GSI Commerce shareholder approval, the company said on Monday.

GSI Commerce's products and technology "will significantly strengthen our ability to connect buyers and sellers worldwide," eBay CEO and President John Donahoe said in a statement.

A new holding company led by GSI founder and CEO Michael Rubin will absorb parts of the company eBay isn't interested in and will divest, including 100 per cent of GSI's licensed sports merchandise business and 70 per cent of ShopRunner and Rue La La. The holding company will receive a $467 million loan from eBay, which will retain a 30 per cent stake in Rue La La and ShopRunner.

EBay expects the deal to be "neutral" in terms of earnings per share in 2011 and accretive next year.

Through May 6, GSI Commerce can entertain competing acquisition proposals, and, if any surface, those will only be made public if the GSI board of directors acts on what it considers a superior offer. EBay would then have a right to match the competing offer.

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