The lead shareholder in AutoHome, the world’s leading automotive marketplace by revenue, is looking to sell its $2-billion-plus stake in the company, Reuters reported last week.
Ping An Insurance Group of China, which bought a 47.4% stake in AutoHome in 2016 and 2017 for $1.6 billion (U.S.) from Australian telecomms company Telstra, has been shopping its current 44% share to Tencent Holdings, the Chinese internet company, along with strategic and private equity investors, Reuters reported. Tencent “did not deem the deal viable due to antitrust concerns,” since it owns BitAuto.
AutoHome generated $1.3 billion in revenue in 2020, making it the leading auto marketplace worldwide by revenue, although the figure is slightly misleading because it includes the value of cars it buys and sells. Its website said it has about 45 million daily active users on its website and 64 million active users monthly on its mobile phone app.
AutoHome, traded on the New York Stock Exchange, rose about 2 1/2% on Friday. However, it closed at 38.93, less than one-third of its high of 136.30 on Feb. 15 this year. Its market capitalization at the close on Friday was almost $4.9 billion.
AutoHome has particular strength in new-car advertising. Its revenue includes classified listings and transaction income. It also has strong revenue streams in media, financing and data sales. In December 2020, it acquired TTP Car, a c-to-b auction platform focused on used vehicles, and said it expected the acquisition to bring in about $62 million U.S. in revenue annually.
BitAuto is the No. 2 automotive classified business in China, with $560 million in revenue, making it No. 6 worldwide. The company’s $560 million in revenue excludes its independent finance business (Yixin) and marketing business. The company announced in June 2020 that it would be acquired and taken private by a subsidiary of Tencent Holdings; the $1.1 billion deal was completed Nov. 5 2020 and BitAuto stock was delisted.
Reuters said Ping An’s insurance business and investment returns have been hit by weakness in China’s economy. Ping An reported a 31.2 fall in Q3 net profit. Reuters said Ping An declined comment, while AutoHome did not respond to a Reuters request for comment. (The AIM Group will update this report if we receive comment from any of the companies involved.)