The announcement of the sale by Spir of 50% of leboncoin.fr to its partner, Schibsted, came as a surprise. It was even more so if one considers the amount of the sale: 200 million euros which means that the site of free ads founded 4 years ago, has a value of 400 millions. If you remember that the Parisien-Aujourd'hui en France, with a circulation of about 480 000 copies could be sold for 100 million, you realize that there is quite a premium on internet and classified ads. They are obvously more sexy than cumbersome newspapers which are too be printed by huge presses and carried all over the country.
However, a closer look at facts and figures makes a different impression. In his excellent newsletter http://www.mondaynote.com, Frederic Filloux shows that the growth capacity of classified ads on Internet is still impressive. Moreover, there is little competition for free ads in France. Leboncoin can apply with great success the Scandinavian system of its sister site Bloket which combines a huge offer of free ads and a more limited but very profitable paid service for professionnals;
Still, there is another explanation for the buying by Schibsted. The Noewegians intend to set up a European group of classified web sites included in Schibsted Classified, a company due to be introduced in 2012 on London stock exchange. In that case, the soaring value of the shares could bring a tremendous profit for this very dynamic media group.
Journalists should be very happy that aging tycoons like Murdoch or Dassault are still willing to invest in old fashioned newspapers. On that point, see the comment of Jack Shafer in http://www.slate.com where he explains that the British press is lucky to get the subsidies of Murdoch for the failing Times and Sunday Times.