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Alibaba/eBay Deal Is Not Imminent, Wedbush Analyst Says

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Alibaba/eBay Deal Is Not Imminent, Wedbush Analyst Says
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Speaking to Benzinga, Wedbush Analyst Gil Luria addressed the rumors of a deal between Alibaba Group Holding Ltd (NYSE: BABA) and eBay Inc (NASDAQ: EBAY).

Luria noted that a number of companies might be interested in acquiring eBay Marketplace or PayPal, and said Google Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) would most likely be interested in PayPal after it is spun off.

As far as eBay is concerned, “there really is only one potential buyer down the road [of sufficient size]...and that’s Alibaba,” according to Luria. EBay Marketplace has a market capitalization between $30 billion and $40 billion, he noted.

Related Link: Do Peers Predict An Earnings Miss At Baidu?

“That doesn’t mean it would happen," Luria added.

"But somewhere down the line if Alibaba decides that it wanted to enter the western markets in a more significant way, this is a path they could pursue.”

Luria commented that western markets are currently saturated and significant market share is held by eBay and Amazon.com Inc (NASDAQ: AMZN). That, he said, is why Alibaba is focused on China, with “some attempts to expand into Russia, Brazil and India.”

While Alibaba may wish to buy eBay at some point for greater access to the U.S., such a deal would not be imminent, Luria concluded.

Alibaba Group Holding Ltd recently traded at $87.22, up 1.42 percent.

eBay Inc, meanwhile, traded at $55.23, up 1.66 percent.

Kevin Riley and Brianna Valleskey contributed to this report.

Image credit: Thomas Lombard, Wikimedia

Posted-In: Gil Luria WedbushNews Rumors Exclusives Interview Best of Benzinga

 

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