Singapore Press Holdings buys sgCarMart for USD 48M

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http://sgentrepreneurs.com/2013/04/02/singapore-press-holdings-buys-sgcarmart-for-usd-48m/

Singapore Press Holdings (SPH), a public-listed media company in Singapore, announced yesterday that it has purchased online car portal sgCarMart for SGD 60M (USD 48M), a significant amount in the country’s digital publishing and media sector.

The deal dwarfs, at least in monetary terms, SingTel’s acquisition of food portal HungryGoWhere for USD 9.4M last year. SgCarMart’s valuation is a x12 multiple over its 2012 annual revenue.

SgCarMart operates a variety of businesses, including vehicle classifieds, a car auction platform, an online marketing site, as well as car loans, insurance and settlement services. Existing shareholders in the company include JDB Investment, Goh Cher Ngann, Ong Poh Huat, and co-founders Henry Seah, Tan Jing Lun, and Vincent Tan.

Vincent is the managing director of sgCarMart, which was founded in June 2004 while he was still a mechanical engineering undergraduate at the National University of Singapore.

Finding the prospects of an engineering career to be grim, Vincent and Henry weighed between giving tuition and starting a business. They settled on the latter, and also realized then that there were no strong online car portal players in the Singapore market. Jing Lun was roped in to round out the team.

Originally a car classifieds service, the startup managed to break even when they graduated in 2007, which meant they were able to pay themselves at a reduced salary of less then SGD 2,000 a month. They had reached critical mass as car dealers became more receptive to listing their cars online.

The company has since grown from a three-person team to more than 60 staff, and claims to capture 90 percent market share in Singapore’s online vehicle classifieds business. By March 2012, it had an annual revenue of SGD 5M with over 10,000 listings on its site. As a result, sgCarMart has been recognized as the top 300 most profitable SMEs in Singapore by the SME 1,000 rankings.

SPH appears to have been active in investing and acquiring tech businesses of late. Last month, it led a USD 2.5M investment round in Chope, a Singapore restaurants booking site.

Of course, the media giant is not a stranger to buying up online portals. Its last major acquisition in this space was in 2006 where it purchased hardware forum and tech publishing company HardwareZone for USD 4.5M.