eBay sells 65% of Skype for $1.9 billion

eBay has announced that it has sold most of its stake in VoIP messaging software platform Skype for $1.9 billion in cash plus a $125 million note. eBay will retain a 35% stake in Skype, and the transaction is expected to be completed in the fourth quarter of this year.

The investor group which bought out eBay's share is being led by private equity firm Silver Lake Partners, and includes venture capital firms Andreesen Horowitz, Index Ventures, and the Canada Pension Plan Investment Board.

Egon Durban, managing director at Silver Lake, said, "Skype is an innovative, next-generation company that has changed how people and businesses communicate with each other. This transaction benefits all parties involved and will allow Skype the opportunity to accelerate the growth of its business by harnessing the deep technological and company development expertise that resides within the investor group. Josh Silverman has done a strong job leading the company and we look forward to working with Josh and his team to grow the Skype franchise."

This transaction fulfills announcements made earlier this year by eBay President and CEO John Donahoe who pointed out that Skype really didn't fit in with eBay's portfolio as it re-evaluates the direction of its business.