South African mass media site Naspers is set to bring about the world’s third largest classifieds site with the merging of its two Russian online classified sites with Avito in a US$570 million deal.
According the the Financial Times, the deal involves Naspers merging Slando.ru and OLX.ru into the Avito brand, together with a US$50 million cash investment for an 18.6 per cent stake in the company.
Koos Bekker, Naspers’ CEO, said in November last year that 20 more e-commerce acquisitions are planned leading up to this month. This was said after the company made US$530 million in acquisitions during the six months leading up to September last year.
Swedish financial service entities including Kinnevik Investments and Vostok Nafta, Baring Vostok, Northzone Ventures, US-based Accel Partners and a private equity house in Russia are all investing in the Avito brand.
The Financial Times reported Avito is expected to hold 15 per cent of revenue in terms of the Russian classified market. Avito is also expected to hold a 25 per cent share of the market in terms of traffic.
Naspers reportedly made US$30 million in sales last year. Currently, Avito has 140,000 users listing items each day. Of those users 40,000 are first time users. Furthermore the site has 4,000 small businesses paying the site to set “stalls” up to sell their merchandise.
The Financial Times reported the merger will escalate Avito to the third largest such site in the world, which places it in the ranks of the US classified giant Craiglist.com and 58.com in China.
Through its 29 per cent investment in Russia’s largest internet company, the Mail.ru Group, Naspers has become an active player in the Russian online market.
HumanIPO reported earlier this month that Naspers had invested in Nigeria’s Konga.com.
