The Market Herald acquires Gumtree, Carsguide, Autotrader for $86m in $100m classifieds play

News 26 Aug 2022 - 4 min read

The Market Herald acquires Gumtree, Carsguide, Autotrader for $86m in $100m classifieds play

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“Gumtree is part of life for millions of Australians, and there are many opportunities to add more products and services, creating an end to end digital offer," The Market Herald MD Jag Sanger says.

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Tags: Gumtree media sales

The Market Herald has gone all in on classified ads, acquiring Gumtree, Carsguide and Autotrader for $86 million. A large part of the valuation of big media companies is their classified businesses, TMH says, and these will add synergies to the ASX-listed company’s existing strategy reaching high net worth individuals.

What you need to know:

ASXlisted The Market Herald has announced it will acquired Gumtree, Carsguide and Autotrader from Adevinta for $86m.
It will release a discounted share offer to raise funds for the deal.
The new shares will be issued for trading on the ASX on September 20.

The Market Herald, an ASX-listed company that publishes stock market news, has acquired Gumtree, Carsguide and Autotrader for $86 million.

In a deal that launches the company, formerly known as HotCopper, into the world of classified advertising – those three businesses reach 10 million households each month, The Market Herald is investing $100 million in classifieds, including expanding its own platform, ‘The Market Herald Fancy’.

The businesses were put up in a sale managed by Macquarie Capital, the AFR reported.

“The Gumtree, Carsguide and Autotrader platform is one of the largest digital communities in Australia,” The Market Herald 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 an end to end digital offer. In addition to the Gumtree, Carsguide and Autotrader proposition is the leading challenger to the $6bn marcap automotive listings incumbent and there are many opportunities to close the gap.”

The Market Herald says its 2.5 million-strong monthly audience has an average household income of $247,000. It is aiming to cater to the High Net Worth community in Australia.

In an investor presentation, the company said classified businesses “account for a significant part of the valuations of listed AU publishers” – REA Group and hipages for News Corp, Domain for Nine and CarExpert for Seven West Media. “Acquiring a leading classified site will create significant value for The Market Herald.

The acquisition of Gumtree Australia, Carsguide and Autotrader Australia, led by Capital Investment Partners in Perth, will involve a vendor loan of $60.1 million and an entitlement offer which will raise approximately $26.55 million. Adevinta Oak Holdings B.V. is the current owner of the three brands, and The Market Herald will need to repay the $60.1 million to Adevinta within 12 months, and is offering a two for five renounceable offer at 34 cents-a-share to raise the $26.55 million – a 15 per cent discount on the closing price last Friday.

The acquisition is due to settle after the ‘entitlement offer’ closes on Thursday 13 September. New shares trade on the ASX on 20 September 2022.