Investment bankers have found a new rival for executing merger and acquisition deals in the form of the Internet, which is making the sale or purchase of a company as simple as the click of a mouse.
Marking a significant coming-of-age for the e-commerce industry, online auction platforms like eBay are no more just about selling or buying consumer goods. In fact, entire companies are being sold and acquired on these websites in a simpler, faster and cheaper way than the traditional methods involving a plethora of investment bankers and advisors.
The trend is catching up fast in India as well after a number of successful deals in the US and other countries. A Lucknow-based telecom firm is seeking bids for 25 per cent stake in the company on eBay India website, a retail outlet in Kharagpur is on sale for a minimum of Rs 18 lakh, while another electric vehicle manufacturing firm from the country is also soliciting potential buyers on the website.
Besides, an operational job portal Alphacareer.com, based in Bangalore, has also listed itself for sale on the eBay USA website and is seeking buyers from across the world.
Another e-commerce website focussed on sale and purchase of a business, Biz Buy Sell, has a US-based company seeking buyer for its fully-staffed Indian software development subsidiary in Mumbai at a base price of $500,000.
When contacted, eBay India spokesperson told from Mumbai this was a new trend emerging in online auction market. Indians always had a highly developed entrepreneur instinct for capitalizing on new trends and mediums, she said.
“Companies have also listed themselves for sale and even a retail outlet in Kharagpur is tapping the online market,” the official said.
The US-based firm seeking buyer on Biz Buy Sell says its Mumbai unit has been operational and profitable for four years and has fully audited records for all four years.
The 25-employee strong unit has a “five-year inexpensive lease in one of the most desirable locations in Mumbai and has one officer’s cabin, one conference room and 60 cubicles, used for software development in day and call center at night.”
The US-based parent, which has not disclosed its name, also says the Indian unit is eligible for going public on the Indian stock exchange as it “is profitable for three years”.
“A US company with 10 million dollar plus revenues could buy this subsidiary, do a reverse merger and potentially go public on the Indian stock exchange. The US company is willing to indemnify the new owners for any issues that could crop up prior to the sale,” it claims.
The site also has a number of Indian restaurants in the US for sale, while an Indian supermarket in Massachusetts is seeking bids for at least $1,19,999.
Back in India, a real estate portal based in Gurgaon is seeking buyers for a minimum bid of Rs two lakh at eBay. The “business ready and developed job portal” AlphaCareer has fixed a starting bid of Rs 5 lakh in its eBay listing.
The Lucknow-based value added cellular service provider, which has not disclosed its name, has fixed a minimum bid of Rs 25,000 and claims to be in the business for seven years.
The 400 square feet retail outlet in Kharagpur is also offering a no-bid direct sale option for a price of Rs 20 lakh, besides an annual rental of Rs 10,000 to the Railways.
Claiming to be based in “the heart of Kharagpur”, it says: “Located in the most renowned Gole Bazar market in the town, it is a place that every businessman longs for. Just visit the shop once and you can’t deny to buy it out.”