Telenor takes strategic 33% stake in 701Search
By Gabey Goh January 15, 2014
- Deal, worth €180 million, sealed in December 2013; gets stake in Mudah.my
- 701Search gets to leverage on Telenor's Asia telco network, and more
TELENOR has taken a strategic step toward increasing its presence on mobile devices and in delivering consumer Internet services in South-East Asia.
The Norwegian telecommunications operator has invested in a joint venture between Schibsted Classified Media AS and Singapore Press Holding (SPH), taking a 33.3% stake in 701Search for €180 million (US$245.8 million).
Digital media company 701Search operates online classified marketplaces Mudah.my in Malaysia, Berniaga.com in Indonesia, Ayosdito.ph in the Philippines and Chotot.vn in Vietnam.
Rolv-Erik Spilling (pic), executive vice-president and head of Telenor Digital, said there is “a strong logic” as to why Telenor sees this as a good fit, both strategically and economically.
He said that mobile will become ever more important as a distribution channel with the rise of digital services and the increasing number of transactions that can be completed via mobile devices.
“In addition to delivering access to both communications and the Internet, Telenor needs to be present on the devices through powerful digital distribution, in storefronts, apps and browsers.
“Participation in the development of successful online classified sites, especially those in emerging markets, will secure Telenor’s presence on devices, and its exposure to mobile Internet growth,” he added.
Spilling also said that a strong online classified position can serve Telenor as a stepping stone for a stronger digital service position, for example, by boosting the company’s ability to distribute financial services or over-the-top (OTT) consumer Internet services.
“This strong Internet distribution position is in tune with the trend of more and more consumer services going digital,” he added.
Responding to queries by Digital News Asia (DNA), Mudah said that with this strategic merger, 701Search as a whole would be able to reap potential synergies by leveraging on Telenor's established Asian telecommunications network, mobile Internet capabilities and subscriber base.
“Telenor's expertise in mobile is also useful as 701Search brings online classifieds into the mobile sphere. Together with Schibsted, which brings extensive knowledge and experience from the online classifieds business, as well as SPH, a leading media company in Singapore with expertise in print and online advertising, 701Search will greatly benefit from the contributions of all three companies,” the company said.
Following the investment in 701Search, Henrik Clausen (pic), chief executive officer of Malaysia's DiGi Telecommunications, has been invited to be part of the board of directors, representing the Telenor Group.
“I look forward to bringing to the board relevant insights from my prior experience in Europe, where I helmed Telenor’s operations in Denmark and a leading fixed broadband operator prior to that, as well as my experience operating in Asia as DiGi’s CEO over the past four years,” he told DNA.
Mudah.my has made changes to its management team with the recent appointment of Omar Giri Valliappan as general manager.
Prior to his appointment, Omar (pic) led the consumer product development and management team at Astro Media Holdings, championing a more consumer-centric approach towards formulating its five-year product strategy and roadmap, Mudah.my said in a statement.
He boasts over 15 years of experience in Europe and Malaysia, in a range of industries including digital television and new media, consumer electronics, and food and beverage.
Commenting on the appointment, Julian Tan, director of Mudah.my and chief executive officer of 701Search, said that Omar brings with him extensive experience in leading high growth companies and would be an invaluable asset to Mudah.my in the company’s next phase of growth.
“Omar is a well-known visionary leader with substantial experience in product innovation gained across several markets. I am confident that his leadership will enable us to cement our position as the No 1 local website,” Tan said.
Mudah.my also said that it would remain focused on its core business of online classifieds, connecting sellers to its audience of 12 million Malaysian shoppers who visit its online marketplace from desktops and mobile devices every month.