Based in Virginia, Trader Interactive offers online advertising and marketing solutions to the recreational vehicle, powersports, commercial truck, and equipment industries

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Carsales to acquire the remaining 51% stake in Trader Interactive. (Credit: Susan Sewert from Pixabay)

Carsales will take full ownership of Trader Interactive, an American digital marketplace business, by exercising its call option to acquire the remaining 51% stake for $809m.

The Australian firm acquired a 49% stake in Trader Interactive from French private equity house Eurazeo in May 2021 at a valuation of $1.62bn.

The current deal values Trader Interactive on a 100% enterprise value basis at $1.89bn. Based in Virginia, the company offers online advertising and marketing solutions to the recreational vehicle (RV), powersports, commercial truck, and equipment industries.

It provides marketplace services via dealer listings subscriptions, brand advertising, private party listings, listing enhancements as well as software, dealer services, and data insights.

According to carsales, the deal will give it market leading positions in the US non-automotive verticals, which are 16 times as large as the non-automotive market in Australia.

It will also provide favourable structural trends resulting from increased participation in the RV and powersports industries, combined with a higher share of digital advertising spend.

With 100% ownership, carsales expects to concentrate on implementing its long-term product and technology strategy for Trader Interactive’s business, with considerable upside likely to result from new product deployment as well as technology innovation.

Carsales is an online automotive, marine, and motorcycle classifieds business.

Carsales managing director and CEO Cameron McIntyre said: “During the course of the last 12 months we have become even more excited about the value of the Trader Interactive business and its growth potential.

“Culturally, there is strong alignment between the carsales and Trader Interactive teams and we are looking forward to working more closely together to unlock the significant potential in the business.

“The Acquisition is a natural evolution of our international growth strategy into large, attractive markets. We have demonstrated an excellent track record of delivering strong shareholder value by diversifying in international markets.”

Trader Interactive is said to have a customer base of over 8,800 dealers and more than 49 original equipment manufacturers (OEMs), as of May 2022.

Trader Interactive CEO Lori Stacy said: “We have thoroughly enjoyed working with Cameron and the carsales team over the last twelve months and we can see how compatible we are from a culture and strategy perspective.

“Trader Interactive is a great business with a proud history and we are incredibly excited about the value that we can generate by leveraging carsales’ product and technology capability. This will enable us to increase the immense value we already provide for our customers.”

The acquisition will be subject to conditions, which are expected to be met in late Q1 FY23.

Carsales has also announced the launching of a A$1.2bn ($830m) equity raising.