• LaCentrale, the leading auto vertical in France, is the prize asset for sale
  • Three parties reportedly interested, including AutoScout24
  • Reasons for selling include focus on real estate, jobs; and strong rival in LeBonCoin

Axel Springer, the Germany-based media giant, is reportedly selling its automotive marketplace business in France. According to France-based financial newspaper Les Echos, Axel Springer is actively looking for a buyer for its local holding company, CarBoat Media.

CarBoat Media is made up of four auto-focused sites:

  • LaCentrale.fr, the No. 1 automotive vertical in France by traffic and revenue
  • PromoNeuve.fr, an auto vertical for new cars
  • Caradisiac.fr, an information service for cars
  • MaVoitureCash.fr, a c-to-b car-purchasing service

CarBoat Media generated turnover of €64 million in 2019 (although this includes boat marketplace AnnoncesBateau.com, which was sold to Boats Group in January), and Les Echos estimates its value at around €400 million (x13 EBITDA).

LaCentrale is the most valuable asset of the bunch. The vertical saw around 13 million total monthly visits in September, according to SimilarWeb. It’s responsible for the dominant share of the group’s revenue, at €55.5 million in 2019.

Les Echos named three current suitors for the buyout: U.S.-based private equity funds ICG and Providence Equity Partners, and AutoScout24, the auto marketplace specialist backed by private equity firm Hellman & Friedman (H&F). LaCentrale would be an ideal acquisition for H&F, expanding its automotive footprint across Europe, particularly as the company missed out on purchasing EBay Classifieds Group and its major automotive assets earlier this year.

Actual bids for CarBoat Media are expected to come by mid- November.

Why is Car&Boat Media up for sale?

With a $3 billion investment, U.S.-based private equity firm KKR took a 44.9% stake in Axel Springer last year. The company went private in April 2020, ending its listing on the Frankfurt Stock Exchange, where it had been traded since 1985. The transaction, announced in June 2019 and completed in December 2019, valued the company at €6.7 billion ($7.6 billion U.S.).

There are several factors likely driving the sale.

Axel Springer’s marketplace assets are focused primarily on recruitment (via its international brand StepStone) and real estate (Aviv Group’s holdings across Europe). Automotive does not really have a sizeable presence in the portfolio outside of France.

Axel Springer owns leading marketplaces in several markets, including:

  • SeLoger and Logic-Immo, the top two real estate verticals in France
  • ImmoWelt.de and ImmoNet.de, the No. 2 and No. 3 real estate verticals in Germany
  • LaCentrale, the No. 1 auto vertical in France
  • TotalJobs.com, the No. 2 recruitment vertical in the U.K.
  • StepStone.de, the No. 2 recruitment vertical in Germany by traffic, but most likely the No. 1 by revenue
  • StepStone.be, No. 1 in Belgium
  • MeineStadt, No. 2 horizontal in Germany
  • Yad2, the No. 1 horizontal in Israel

KKR likely sees the path to growth by focusing on Axel Springer’s strengths, rather than hanging on to minority assets.

While LaCentrale is the No. 1 automotive vertical in France by visits and revenue, it is behind horizontal giant LeBonCoin (LBC) in cars. The leading marketplace business in France reported monthly visits of almost 50 million to its automotive category in May, and LBC is also ahead on revenue from autos. Without major investment, the future looks uncertain for LaCentrale, and KKR is likely not interested in waging a funding automotive war against Adevinta’s prize asset in France.

Instead, Axel Springer has been focusing on real estate investments in Poland via its joint venture with Switzerland-based Ringier – Ringier Axel Springer.

In February, Ringier Axel Springer acquired the No. 3 horizontal in the country, Gratka.pl, while in April it became the majority shareholder in MZN Property, which runs Morizon.pl, the No. 3 property vertical in Poland. The company purchased a 79% stake at MZN Property for PLN66.1 million ($15.8 million U.S.) based on a tender offer that was priced at 50 cents U.S. per share.

The expectation is that the combination of both marketplaces will be used to build a major contender in real estate.

This focus on developing cross-country synergies in real estate and recruitment likely makes CarBoat Media an expendable asset.

Car&Boat Media has experienced continuous growth since its acquisition by Axel Springer in 2014. The Germany-based company spent €72 million to take 51% of the group from Spir Communication. Axel Springer gradually acquired the remainder of the capital to become the full owner in September 2016.

The AIM Group will be publishing more in- depth analysis on the potential sale of CarBoat Media in the coming weeks.

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