As expected, Flipkart is buying eBay Inc.'s Indian business in exchange for an equity investment by the online auctioneer in the Indian e-commerce giant.
EBay said April 10 that it will make a cash investment of $500 million in its eBay.in business, which will be owned and operated by Flipkart upon the close of the transaction.
Under the transaction, which is expected to close later in 2017, Flipkart will buy eBay's buyers in India. EBay will remove the number of active buyers in India from its reporting during the quarter in which the transaction closes. Also, eBay does not expect this transaction to have a material impact on its guidance provided on Jan. 25.
Further, the companies struck an exclusive agreement to jointly pursue cross-border trade opportunities. The partnership is expected to help make eBay's global inventory accessible to more India consumers, while active buyers on eBay will get greater access to Indian inventory provided by Flipkart.