For those of you who don’t know, eBay bought a minority ownership stake (28.4%) in Craigslist nearly four years ago as part of a strategy to buy up classified advertising services both in the United States and Europe.
In a lawsuit filed under seal in Delaware Chancery Court last week, eBay alleged that Craigslist held “clandestine” directors’ meetings in recent months to dilute eBay’s 28.4% stake to 24.85%, or less than a quarter of the company.
“We are no longer comfortable having eBay as a shareholder, and wish to explore options for our repurchase, or for otherwise finding a new home for these shares,” Craigslist Chief Executive Jim Buckmaster was quoted in the court papers as telling eBay’s then CEO Meg Whitman last summer. Why did they let eBay in in the first place??? I have no idea.
All I know is that eBay now wants to propose a formal marriage so to speak and acquire Craigslist. Why? Simply because Craigslist could be worth several billion dollars. It ranked as the world’s third most valuable Web startup in a list released by Silicon Alley Insider earlier this week: valued at around $5 billion, Craigslist falls behind only Facebook and Wikipedia.
Craig Newmark, the founder of Craigslist, says providing a good community service rather than earning a lot more money than a single individual needs is his motivation in continuing his Craigslist work. Newmark and Buckmaster have defied the conventional path taken by virtually all successful Silicon Valley start-ups by refusing to go on the stock market through an initial public offering. Pretty unusual…
I can’t wait to see how all this is going to end…
3 replies on “Craigslist wants to get away from eBay”
[…] few weeks after being sued by eBay, CraigsList is now suing the auction giant, alleging eBay had used its minority stake in Craigslist […]
I hope craiglist gets away from eBay. It won’t be a long time until they start charging fees for using CL :/
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