Etsy (ETSY) is selling its secondhand clothing platform called Depop to eBay (EBAY) for $1.2 billion U.S. in cash.
The deal comes five years after Etsy purchased Depop for $1.62 billion U.S. as the company sought to attract younger consumers.
Depop is an app that allows people to sell their used clothing, shoes, accessories and other goods. About 90% of Depop’s users are under the age of 34.
eBay’s acquisition of Depop is expected to close in this year’s second quarter.
Etsy had acquired several niche online platforms over the years as it pursued a “house of brands” strategy.
But the company has ended up selling many of those niche platforms, including Brazilian e-commerce company Elo7 and musical instrument marketplace Reverb.
Etsy is an e-commerce company focused on handmade, vintage, and craft items. It has struggled to grow its business since the Covid-19 pandemic ended.
The company has also been hit hard by tariffs and a pullback in discretionary spending among consumers.
For its part, eBay said Depop will help it grow its presence in fashion moving forward.
ETSY stock is up 18% on news that it has sold the Depop platform. Over the last 12 months, the company’s share price had declined 15% to trade at $44.05 U.S.
Tech Insider
