Online classifieds space in SEA sees merger between top two players, Carousell and Telenor owned 701Search
By Digital News Asia November 21, 2019
- Carousell valued at US$850m with Telenor Group largest minority shareholder
- Combined businesses will report into Carousell chief executive Quek Siu Rui
Online classifieds startup, Carousell, announced today that it has signed an agreement with Telenor Group, one of the world’s largest telecommunications companies. As part of this equity and cash agreement, Carousell will merge with 701Search, which owns online marketplaces Mudah in Malaysia, Cho Tot in Vietnam, and OneKyat in Myanmar.
Following the merger, Carousell will be valued at more than US$850 million (RM3.53 billion) with Telenor becoming the largest minority shareholder in Carousell, owning 32 percent of the combined company.
“This has been a significant year for Carousell, with the company achieving unprecedented results in market expansion and revenue growth,” said Rakesh Malani, Chief Financial Officer, Carousell. “We are driving rapid consolidation in the region with the OLX Philippines merger earlier in the year, and 701Search today. This transaction further cements Carousell as the leading online classifieds marketplace platform in Southeast Asia. With annualized revenues of over US$40 million (RM166 million), a business of over 80 percent gross margin and two profitable markets, we are very well positioned to advance our combined business to the next level.”
Following the merger, 701Search’s regional hub team that operates in Singapore will be fully integrated into Carousell, while Mudah, Cho Tot and OneKyat will retain their individual names and platforms, continuing operations in Malaysia, Vietnam and Myanmar respectively. The businesses will report into Carousell Chief Executive Officer Quek Siu Rui.
“Our mission has remained the same since day one. We want to inspire every person in the world to start selling and buying,” shared Quek, also a cofounder. “Merging with 701Search will allow us to further this mission on an even greater scale and fortify our leadership in Southeast Asia as Mudah, Cho Tot and OneKyat are already leaders in their markets. I am excited to work with our new teammates to learn about the dynamics of these local markets, create win-win opportunities that are mutually beneficial for our community of users, and inspire even more people to start selling and buying.”
Johan Rostoft, Head of Online Classifieds at Telenor Group, said “We have built a profitable and high-growth marketplace business serving millions of users every single day. This transaction presents an attractive opportunity for us to take the next step in our marketplace journey, and it also simplifies Telenor’s portfolio. We believe that Carousell is the best partner for our online classifieds business in Southeast Asia.” In June 2017 the Telenor Group bought out the combined 67% stake held in 701Search by its joint venture partners, Schibsted ASA and Singapore Press Holdings for NOK 1.753 billion (US$191.4 million).
Carousell’s advanced and intuitive technology, coupled with the Telenor Group companies’ hyperlocal reach and extensive experience, will further propel Carousell’s Classifieds 4.0 vision of reimagining classifieds and making the selling and buying of second-hand a first choice.