Listed media conglomerate The Market Herald (ASX: TMH) has today announced an US$60 million ($86.7 million) acquisition of three major classifieds platforms Gumtree, Carsguide and Autotrader from Norway-based Adevinta.
The move is part of the TMH's $100 million push into the classifieds space, and comes two years after former Gumtree owner eBay offloaded its portfolio of classifieds businesses to Adevinta for US$9 billion.
To fund the purchase, which is worth more than TMH’s current market capitalisation of $78 million, the media company has entered into a vendor loan of approximately $60 million with Adevinta. Under the arrangement, TMH will repay the loan within a 12 month period.
The company is also looking to raise $26.55 million from shareholders via an entitlement offer of new shares at $0.34 per share, diluting its security-base in the process.
The deal will see Perth-based TMH acquire all the issued share capital in Gumtree Au Pty Ltd, which owns Carsguide Autotrader Media Solutions. These two entities own the Gumtree Australia, Autotrader Australia and Carsguide brands.
Post-acquisition, TMH will take control of Gumtree - a marketplace used by one in three Australians and 10 million households every month. The platform boasts 100,000 new listings every day, 3.5 million registered users and 6 million app downloads.
It marks a significant expansion of the listed media company, which operates a number of sites including financial news site The Market Herald, digital consultancy Advisir, ASX trading forum HotCopper and more.
“The Gumtree, Carsguide and Autotrader platform is one of the largest digital communities in Australia,” TMH managing director Jag Sanger said.
“Gumtree is part of life for millions of Australians, and there are many opportunities to add more products and services, creating and end to end digital offer.
“In addition the Gumtree, Carsguide and Autotrader proposition is the leading challenger to the $6 billion marcap (market capitalisation) automotive listings incumbent and there are many opportunities to close the gap.”
Alongside the acquisition announcement, TMH has launched a new editorial-led information platform for non-advised high net worth audiences called The Market Herald Family Office.
The company is targeting 40 per cent of its audience with household incomes of $247,000 plus who do not use financial advisers. Instead, TMH says this segment is self-directed, meaning they research and act on information they find themselves.
“The Market Herald will serve this valuable self directed segment of HNW investors by launching The Market Herald Family Office,” TMH said.
“This will first be an editorial and streaming video offer covering the products and services that self directed HNW investors need to manage their wealth. This includes estate planning, tax, philanthropy, wellness, art and alternative asset consultancy and other services.
“Second this will be a marketplace of service providers wanting to connect to this audience through listings, streaming segment sponsorship and transactional offers.”
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