Automotive e-commerce platform carsales.com is calling on institutional and retail investors to back its equity-raising campaign to generate $600 million to boost its footprint in the US market.
The $4.8 billion company intends to pay $800 million with equity and debt to acquire a 49 per cent interest in Virginia-based digital marketplace developer Trader Interactive.
The company is offering shares at $17 per security, which represents a markdown of $2.51 from the previous session’s closing price.
Every 6.99 shares will enable access for eligible investors to purchase one new Carsales share at the discounted price.
The first round of offers is being conducted in the institutional pool for two days starting today, while retail investors can get involved from at the same time next week. A bookbuild scheme has been set up to cover any possible shortfall.
Carsales has estimated the enterprise value of the US marketplace specialist operating e-trading platforms for powersports, recreational vehicles, commercial trucks and equipment at $2.07 billion.
The ASX-listed online trading company considers the move to be a “compelling” and crucial step in Carsales’ global expansion strategy.
The corporation’s CEO said, “This acquisition is expected to accelerate our international growth strategy by providing us with exposure to a significant market in the United States across attractive non-automotive verticals,”
Trader Interactive’s diverse suite of e-commerce brands and established user and subscriber base are among the main factors attracting carsales’ interest.
The Australian digital marketplace platform believes it will gain “exposure to appealing verticals” and a more emphatic presence “in the large US market”.
Shares in carsales (ASX:CAR)
last traded at $19.51