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eBay closes the deal on Skype sale

by Sylvie Barak on 20 November 2009, 09:15

Tags: Skype, eBay

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Clear Sky(pe) ahead

After putting its legal strife behind it, eBay has finally called its sale of Skype to a close for some $2 billion.

Settling its legal differences with Skype founders, Niklas Zennstrom and Janus Friis - who had been waging a copyright infringement suit against the VoIP outfit - meant eBay could now seal the sale of a 70 per cent stake in the firm to investors for about $1.9 billion plus $125 million to be paid at a later date.

Zennstrom and Friis - also founders of P2P firms Kazaa and Joltid - had been suing Skype for purportedly infringing on their technology "at least 100,000 times each day," at "a rate of $75 million daily."

The pair had been seeking both an injunction and damages from Skype's owners, throwing something of a spanner in the works when it came to eBay's various attempts to offload its ill-thought out acquisition.

eBay had snapped up Skype for around $2.6 billion in 2005, but soon discovered it had "limited synergies" with its new purchase.

Realising it wasn't making any money to cover its significant outlay and that there was little way to integrate Skype into eBay's business model, the auction firm did what it does best and attempted to flog the VoIP firm to the highest bidder.

A consortium of investors led by Silver Lake and including Index Ventures, the Canada Pension Plan and Andreessen Horowitz, expressed interest in the Skype shares, and came close to closing the deal before the lawsuit complicated matters.

But the settlement between eBay and the former founders means that in return for dropping the case, Zennstrom and Friis get a 14 per cent stake in Skype whilst the firm also gets ownership of critical software that had been licensed to it from Joltid. The remaining investors will get 56 percent ownership, whilst eBay retains 30 per cent.

Wonder if the sale can be put down to tele-marketing?

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