Naspers, a multinational internet and media group headquartered in South Africa, said it has spent $1.16 billion to buy the 29.1 percent it did not already own, to take full control of Avito, Russia’s largest classified advertising platform.
The media and e-commerce group, which made the deal through its classifieds business OLX Group, implied an enterprise value of about $3.85 billion and would boost its holding in the company from 70.4 percent to 99.6 percent, with Avito’s co-founders holding the rest.
Chief Executive Officer of Naspers, Bob van Dijk said “Avito is the leading online classifieds player in Russia and our decision to increase our stake reflects our belief in the long-term prospects of this great business and the Russian internet market”.
Avito, which today owns and operates the country’s largest online classifieds website Avito.ru., was launched by entrepreneurs Jonas Nordlander and Filip Engelbert in 2007 as Russia’s answer to Craigslist. Online marketplaces in Russia have grown rapidly in the last few years, offering anything from food delivery and cleaning to private house construction services.
According to Avito’s website, its marketplace covers a range of categories including autos and real estate and attracts more than 32 million unique visitors a month.
Naspers purchased a 17.4 percent stake in Avito in 2013, merging in its local classified businesses and injecting $50 million in cash. The transaction valued Avito at more than $570 million. The South African media giant then raised its holding to 67.9 percent, valuing the company at $2.4 billion and leaving it with four minority investors.
Naspers, which had $8.7 billion in cash as of the end of September 2018 primarily from the sale of Flipkart and Tencent shares, said the deal was funded by its existing cash resources.