CMA launches inquiry into eBay's acquisition of Depop
The UK Competition and Markets Authority (CMA) has formally launched a Phase 1 merger inquiry into eBay's proposed $1.2 billion (£890 million) acquisition of Depop from rival Etsy.
The CMA confirmed on 8 June that the merger notice meets the requirements of the Enterprise Act 2002, adding that it had sent notices to both eBay and Depop regarding the inquiry.
The regulator will assess whether the deal could lessen competition in the UK second-hand fashion market.
By 6 August, the CMA must decide whether to clear the transaction or refer it for a more detailed Phase 2 investigation. The regulator said it will seek to complete its review as quickly as possible, although statutory deadlines can be extended in certain circumstances.
The inquiry follows a public consultation period that ran from 23 April to 8 May, during which the CMA invited comments from interested parties on the potential impact of the deal on UK competition.
When eBay first announced the deal, it said that Depop would help it cater to a "younger demographic" as the online marketplace giant targets long-term growth.
The deal was originally expected to close in the second quarter of the year.
Depop, which was founded in London in 2011, is expected to retain its name, brand, platform and culture, the companies said. The business has expanded on the back of growing demand from Gen Z and Millennial shoppers to buy sustainably and avoid old items going into landfill.
At the time the deal was announced, Jamie Iannone, Chief Executive of eBay, said: "Depop has built a trusted, social-forward marketplace with strong momentum in the pre-loved fashion category, and we are confident that, as part of eBay, Depop will be even more well-positioned for long-term growth, benefiting from our scale, complementary offerings, and operational capabilities."
