16 July 2021 | Business

eBay to sell stake in Adevinta

US e-commerce firm eBay Inc said on Wednesday it would sell part of its stake in Norwegian classifieds group Adevinta to private equity group Permira for US$2.25 billion in cash.

The deal comes after Austria's Federal Competition Authority (FCA) demanded eBay reduce its financial interest in Adevinta to no more than 33% to approve the tie-up of their global classified ads businesses.

In the latest deal, eBay will sell 125 million shares, or 10.2%, to Permira, leaving the US firm with a 34% stake in the Adevinta. Permira has a 30-day option to buy an additional 10 million shares at the same price, reducing eBay's stake to 33%.

Under last year's deal, Adevinta was to acquire eBay's Classifieds Group in return for US$2.5 billion in cash and 540 million shares, valuing the transaction at about US$13 billion at current stock market prices.

The transaction between eBay and Permira is expected to close in the fourth quarter this year, Adevinta said. -Nampa/Reuters

Dunelm lifts profit view

British home furnishing retailer Dunelm said on Wednesday it expects annual earnings to top market expectations as people renovate their homes during the pandemic, but warned about cost pressures across the supply chain.

Dunelm, which said it has planned for two new distribution facilities to ramp up capacity that will cost it 12 million pounds this year and 8 million pounds in the next, declined to elaborate on the supply chain issues.

"Sales in the weeks following reopening on 12 April were exceptionally strong, partly reflecting pent up demand," the company said.

Dunelm reported online sales growth of 38% with total store sales surging 43.9% for the quarter ended June 26, thanks to demand for products including bedding, curtains and dining furniture.

The company said it expects a pretax profit of about 158 million pounds (US$218.6 million) for the year ended June 26, compared with analysts' average expectation of 149 million pounds to 153 million pounds, according to company-compiled estimates. - Nampa/Reuters

Nike loses fight against EU probe

US sportswear maker Nike on Wednesday lost its fight to stop a probe into its Dutch tax affairs, as Europe's second-highest court backed an EU investigation opened two years ago.

The EU case was part of a crackdown on multinationals' sweetheart tax deals with EU countries that Brussels says gives them an unfair advantage, among them Apple's Irish tax arrangements, and Fiat Chrysler and Amazon's Luxembourg deals.

The Luxembourg-based General Court dismissed Nike's challenge against the EU investigation. "The European Commission complied with the procedural rules, and neither failed to fulfil its obligation to state reasons nor made manifest errors of assessment," the court said.

Judges said the EU executive carried out its provisional assessment of the measures at issue in a diligent and impartial manner and that it did not breach the principle of good administration.

The US sportswear maker had objected to the Commission's 2019 decision to investigate five tax rulings issued by Dutch authorities from 2006 to 2015 to the company. - Nampa/Reuters

BT to phase out 3G in two years

BT, the owner of Britain's EE mobile company, said on Wednesday it would phase out 3G in the next two years to free up airwaves to help bring 5G to the entire country by 2028.

BT Consumer CEO Marc Allera said demand for mobile capacity was rising by 40% every year, and BT had switched on its 5G network in 160 towns and cities since it launched in 2019.

Traffic had more than quadrupled on its 5G network since October, when the 5G-enabled iPhone 12 launched, he said. While 4G and 5G demand continued to rise, traffic carried on older 3G and 2G networks was declining, he said. Less than 3% of data and 25% of voice traffic was carried on 3G in March.

"EE is the first operator to set a time frame to stop supporting 3G services in early 2023, with customers supported to move off it in a phased transition in the months ahead," he said in an online presentation.

The end of 2G services, which are now 25 years old, would follow later in the decade, he added. Third generation mobile technology, which launched in Britain in 2003, offered a jump in data capacity, enabling internet access on mobiles. -Nampa/Reuters

Delta Air swings to profit on vaccination

Delta Air Lines on Wednesday posted its first quarterly profit since the coronavirus pandemic began and said it expected to remain profitable for the rest of the fiscal year, as travel demand picks up on the back of speedy vaccinations.

Net income reached US$652 million, or US$1.02 per share, in the three months to June 30, helped by government aid for US airline workers' salaries as well as a strong rise in quarterly revenues, which topped analyst estimates.

"The days of cash burn are behind us," Delta Chief Executive Officer Ed Bastian told Reuters. "Domestic leisure travel has fully recovered to 2019 levels, and there are encouraging signs of improvement in business and international travel," he said.

Delta's second-quarter adjusted operating revenue fell 49% to US$6.35 billion from 2019, a marked improvement from the 60.4% slump in the first quarter and above analysts' average estimate of US$6.22 billion.

Delta said it expects adjusted operating revenue for the September quarter to be down 30% to 35% from two years ago, with the midpoint at US$8.47 billion, above a Refinitiv-IBES estimate of $8.23 billion. - Nampa/Reuters