Tom.com Has Signed Acquisition Agreement With eBay Eachnet

By TechSecurityChina.com Editor
November 03, 2006

According to various online Chinese media reports, Tom Online (TOMO) has signed an agreement with eBay (EBAY) Eachnet to acquire the struggling auction website, and the parties will make a formal announcement very soon.

According to the reports, Zhou Kaixuan, a shareholder of eBay’s subsidiary Skype, has acted as a go-between in the negotiations.

Tom.com has not made any direct comment on the issue, but eBay Eachnet has directly denied the rumor.

There have been different rumors about eBay Eachnet’s prospects for a long time. As earlier as April, rumors spread that eBay might withdraw from the Chinese market due to sharp market share decline. The resignation of Martin Wu, CEO of eBay Eachnet, in September has also been regarded as a signal that eBay will either leave China or merge with another company.

However, eBay Eachnet may also choose a cooperation similar to that between Yahoo China and Alibaba.

In June 2003, eBay acquired Eachnet, the largest e-commerce website in China, for US$150 million, but its market share in China has been declining dramatically in recent years with the appearance of Alibaba’s Taobao.com. In 2005, eBay Eachnet only accounted for 29.1% of the market share, but Taobao.com held 67.3%.

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