Etsy shares skyrocketed more than 17% on Wednesday after the company announced eBay would acquire its secondhand clothing reseller Depop for about $1.2 billion in cash.
The deal comes almost five years after Etsy bought Depop for roughly $1.62 billion, giving the online marketplace an edge into younger consumers who flocked to the U.K.-founded app to hawk their used clothing, shoes, accessories and other goods. About 90% of Depop's users are under the age of 34, Etsy said.
"We are excited that this transaction allows us to focus exclusively on the compelling opportunity we see in front of us: to grow the Etsy marketplace in ways that matter most to our buyers and sellers," Etsy CEO Kruti Patel Goyal said in a statement.
In recent years, Etsy snapped up several niche online marketplaces as part of a "house of brands" strategy to compete with bigger, faster growing rivals like Amazon. But it's since unwound many of those deals, including Brazilian e-commerce company Elo7 in 2023 and musical instrument marketplace Reverb last year.
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