British Internet auction company QXL Ricardo plc said Wednesday that it has received a takeover bid, pushing its shares up as much as 18%.
Recent press reports have identified two potential suitors: U.S. powerhouse eBay and Alibaba.com Ltd., a Chinese e-commerce company partly owned by Yahoo! Inc.
Shares of London-based QXL gained as much as 275 pence to 1,785 pence on Wednesday after the group said it had received a "preliminary approach which may or may not lead to an offer." By late afternoon they had cooled to pence 1,655. The company is now worth about £764 million ($1.6 billion).
Launched in the late 1990s in hopes of becoming Great Britain's answer to eBay, QXL swallowed German rival Ricardo before it was hit by the dotcom crash. Its troubles attracted the interest of financial investors, who eventually proved unable to take the company private despite a heated bidding war.
QXL has since successfully positioned itself as the most popular online auction site in Eastern Europe and recently won a court case giving it full ownership of its Polish division. The group also recently began a squeeze-out of minority shareholders in Ricardo.de AG, the German rival it gained control of seven years ago.
Analysts have suggested QXL could be swept up as part of a broader, high-paying Internet consolidation as the likes of Google Inc. and Yahoo! spend billions of dollars on advertising and digital content companies. That consolidation likely helped Yahoo with Alibaba's $1.5 billion initial public offering on Tuesday in Hong Kong. The stock nearly tripled in its first day, giving Alibaba capital for an acquisition.
Yahoo invested $1 billion for a 40% stake in Alibaba's parent company in 2005.
In the six months ended Sept. 30, QXL Ricardo posted a 56% gain in revenue to £30.6 million, with net income of £4.75 million. The group, which will soon change its name to Tradus plc, also recently acquired a 30% stake in Russian rival Molotok.ru for $1.5 million.
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