eBay used the PayPal split in July to shed itself of its enterprise businesses, selling it to a consortium of private equity investors for $925 million, one of which sold the CRM division to Zeta Interactive. The companies announced the deal late Monday.
The equity firms consist of Sterling Partners, Longview Asset Management, and the Innotrac Corporation, a Sterling Partners portfolio company, and companies owned by the Permira Funds, which then sold the CRM division to Zeta Interactive.
Zeta Interactive funded its part of the deal, the eBay Enterprise CRM Division, with the $125 million raised in July from the Blackstone Group. The 8-year-old company, cofounded by John Sculley and David Steinberg -- formerly known as XL Marketing until a name change in January -- has been focused mainly on email marketing and analytics that support customer lifecycle management.
Now Zeta wants to expand to take on rivals Oracle, Adobe, Salesforce, and IBM in the business of acquiring and keeping customers. The CRM division consists of an email service provider, database management system, and attribution technology. COO of Zeta Steven Gerber told Search Marketing Daily the acquisition adds lots of technology and about 400 employees to its existing 600, as well as a line of well-known companies such as American Airlines, Ralph Lauren, and Major League Baseball.
While the deal moves Zeta deeper into retail, it also provides the company with an entrance into Singapore, breaking up the stronghold with an existing 85% presence in the United States and 15% in the United Kingdom. Gerber believes it also will give the company a foothold in southeast Asia.
The equity consortium of buyers separated eBay Enterprise into four distinct businesses: Enterprise Operations & Enterprise Technology Services owned by Sterling Partners, The Magento Commerce Technologies business owned by the Permira Funds, The Marketing Solutions business owned by the Permira Funds, and the CRM business, which Permira Funds sold to Zeta.
As an independent company, eBay Enterprise Marketing Solutions aims to better serve brands and retailers through dedicated resources. The enterprise business helps retailers build and manage online storefronts.
Sterling Partners, together with Longview Asset Management, announced the formation of a standalone Omni-Channel Commerce Operations company. The former enterprise services division of eBay Enterprise will be integrated with operations of Innotrac, a Sterling portfolio company.
Permira announced it would spin off some of its assets gained in the acquisition into Magento Commerce, an independent company centered on Magento, an open source e-commerce software platform that eBay acquired in 2011, the year it bought GSI Commerce for $2.4 billion.
Mark Lavelle, former senior vice president at eBay Enterprise, will lead Magento Commerce as its new CEO. The company claims the platform powers more than 240,000 sites globally and supports more than $50 billion in gross merchandise annually.
The new eBay Enterprise Marketing Solutions plans to leverage Banneker's focus on data-driven, product, marketing and sales processes, and Permira's global network supported by technology and investment expertise.
The company will focus on paid-search advertising and search engine optimization, and will support an affiliate network that allows advertisers to reach consumers across a vast network of publishers using tracking technology and analytics. The display advertising platform relies on a programmatic ad platform, direct relationships and advanced audience targeting to reach existing customers and identify new ones. Other areas include social, data and analytics, and agency services.