RealTime IT News

eBay Grabs Rent.com for $415M

Web auctioneer eBay continued its expansion into classified listings late Thursday with the acquisition of Rent.com for $415 million in cash and stock. According to eBay, Rent.com, the most visited apartment-listing site in the United States, will continue to operate as a separate unit.

The terms of the deal include $30 million in cash and $385 million in eBay stock. The acquisition is expected to close in the first quarter of next year, subject to the approval of regulators and the Rent.com stockholders.

"The Rent.com business model is an excellent fit with eBay . . . We are especially pleased that our customers will have the opportunity to benefit from the power of eBay and its community of users," Scott Ingraham, Rent.com's CEO, said in a statement.

Rent.com's transaction-based business model allows apartment owners and managers to list properties on its site free of charge and pay fees only for leases produced through Rent.com. According to comScore MediaMetrix, the Santa Monica, Calif.-based Rent.com is the number one third-party producer of verified lease transactions in the nation both online and off.

The Rent.com service is available to renters and property owners and managers in most American cities, including the nation's top 50 metropolitan markets. The privately held Rent.com expects revenues in 2004 to total more than $40 million.

The Rent.com deal is the fourth buy into the classified advertising field this year by eBay. In April Ebay paid $121 million for Mobile.de, a German-based classified site for buying and selling automobiles, and followed that up with the $290 million November acquisition of Markplaats.nl, the most popular Web classified site in the Netherlands.

In addition, eBay in August took a 25 percent stake in San Francisco-based Craigslist.

"Rent.com has been extremely successful in the apartment rental space online and is a great match for eBay," Bill Cobb, president, eBay North America, said in a statement. "Together we can strengthen both businesses and help consumers get the most out of real estate online."

This is not the first time eBay has jumped into the barter and trade business. As early as 1998, the company had established several regional sites to appeal to trade-eager customers that might usually head for the local newspaper's classified ads.