EBay sold Skype to a group of private investors just three years after paying $2.6 billion for the VoIP service. EBay will get $1.9 billion in cash and retain a 35 percent stake in the company.
The deal was led by Silver Lake and a group of investors including eBay board member Andreessen Horowitz and the Canada Pension Plan Investment Board. It also values Skype at $2.75 billion. Earlier this year, analysts pegged the company’s book value at $1.7 billion.
EBay outbid Google and Yahoo for the Internet calling service in 2005. Hefty payouts to Skype founders Niklas Zennstrom and Janus Friis brought the transaction to $3.1 billion. The deal turned foul when eBay took a $900 million charge on it two years later, bringing Skype’s total price tag to about $4 billion.
To make matters worse, a lawsuit filed in a British court earlier this year by Zennstrom and Friis against eBay revealed that the company never secured the exclusive rights to the peer-to-peer technology at the core of Skype. Though the lawsuit will not be heard until next year, it appears that Zennstrom and Friis may be in a position to revoke eBay’s access to Skype’s essential technology.
Zennstrom and Friis formed a venture capital fund called Atomic with the hopes of buying back Skype. The plan fell through when they failed to raise enough money for an outright purchase of the VoIP service.
It was not disclosed how the ongoing legal battle affects the purchase.
Skype posted sales of $170 million last quarter and added 37.3 million registered users, bringing its total customer base to 480.5 million.
Skype has been an active presence in the wireless industry. The company has aggressively pushed for VoIP over wireless networks and petitioned the FCC in 2007 to force carriers to unlock their data networks to third-party applications and hardware.
Skype also challenged the FCC over the definition of open wireless networks and has suggested carriers’ business practices are inconsistent with the consumer empowerment principles of the Internet Policy Statement.
Filed Under: Industry regulations
