Dear all
I am delighted to confirm that last night at 21:00 GMT we announced an exciting deal with Schibsted, Telenor and Singapore Press Holdings to jointly develop strong classifieds businesses in Brazil, Indonesia, Thailand and Bangladesh.
We have already held meetings with our teams in these countries, and also our team in Argentina. I wanted to share this important news with all of you because it is a great opportunity for us.
Firstly, I’d like to say a huge thanks to you, because we are building a world-class Classifieds business together. Our work has set solid foundations for achieving our mission of helping people improve their lives through facilitating win-win exchanges.
During the last two years we have step-changed the quality of our operations, increased the knowledge and strength of our teams, built brand awareness in our local markets, and driven big growth worldwide. It has resulted in a very attractive pipeline of Classifieds businesses for the future, spanning around 40 countries globally.
However, in Brazil, Indonesia, Thailand and Bangladesh we faced potentially long and costly roads to build sustainable classifieds businesses. Creating joint ventures in these markets enables us to accelerate the process and share the costs of doing so. Together we will develop the markets more quickly and bring the benefits to consumers sooner, resulting in sustainable businesses.
The deal has to be approved by the relevant competition authority, and if it is, we believe we will see a number of benefits in each country:
It’s best for consumers: By forming one strong, well-resourced classifieds platform in each country, we will make it faster and easier than ever for people to trade and turn their items into cash. This accelerates our mission of helping people improve their lives through facilitating win-win exchanges.
Increased expertise: Schibsted has a long history of building high-quality classifieds platforms and will bring specific expertise to the table (e.g. content moderation, desktop engagement, verticalisation, monetisation).
Faster market development: We will share the costs of building consumer awareness about the benefits of a vibrant online classifieds market.
Building the OLX brand: We will strengthen the OLX brand by using it for two of the new joint ventures. This is a reflection on the exceptional work we’ve all done to date to build our brand.
The deal
The structure of each deal is different in each country, and the different share ownerships have been determined by the relative operational size of our existing businesses in the country. Other factors are involved too, particularly how we best maximise our combined shareholder value. For example, In Brazil, we would merge our operations to create a 50-50 joint venture and use the OLX brand.
In Indonesia, we would create a joint venture with a 64-36 majority ownership for Naspers and also use the OLX brand.
In Thailand, the new joint venture would have a 56-44 majority ownership for our partners. We have yet to make a decision on the brand in Thailand.
Finally, in Bangladesh, the new joint venture will have a 51-49 majority ownership for our partners, and the existing Ekhanei.com brand will be used. This decision on brand reflects the marketing investments that Telenor has made to date.
In all our other markets outside of these four countries our strategy is unchanged and executional excellence remains the priority.
What happens next?
As I mentioned, we have communicated the announcement to our teams in each country, and our team in Argentina. We expect the competition authority decision in early 2015, and until then, we have asked everyone to continue the progress we have been making. So it’s business as usual at Classifieds.
We know there will be lots of questions, particularly from the teams in the deal countries. Some answers we are able to give during the employee briefings, but others need to wait until we have the approval to proceed with the deal. We’ll try to minimise any uncertainty over the next few months by keeping everyone informed the moment we have any more information to share.
This news will attract media attention, and where relevant, the in-country teams will handle this reactively. If the media approaches you directly, please refer them to your regional CEO.
Finally, it just remains to be said that I feel extremely energised by today’s announcement. I am very proud that all your efforts have enabled us to make this deal, and I hope you are proud too.
This is a great step forward for Classifieds.
BR
Dear all
I am delighted to confirm that last night at 21:00 GMT we announced an exciting deal with Schibsted, Telenor and Singapore Press Holdings to jointly develop strong classifieds businesses in Brazil, Indonesia, Thailand and Bangladesh.
We have already held meetings with our teams in these countries, and also our team in Argentina. I wanted to share this important news with all of you because it is a great opportunity for us.
Firstly, I’d like to say a huge thanks to you, because we are building a world-class Classifieds business together. Our work has set solid foundations for achieving our mission of helping people improve their lives through facilitating win-win exchanges.
During the last two years we have step-changed the quality of our operations, increased the knowledge and strength of our teams, built brand awareness in our local markets, and driven big growth worldwide. It has resulted in a very attractive pipeline of Classifieds businesses for the future, spanning around 40 countries globally.
However, in Brazil, Indonesia, Thailand and Bangladesh we faced potentially long and costly roads to build sustainable classifieds businesses. Creating joint ventures in these markets enables us to accelerate the process and share the costs of doing so. Together we will develop the markets more quickly and bring the benefits to consumers sooner, resulting in sustainable businesses.
The deal has to be approved by the relevant competition authority, and if it is, we believe we will see a number of benefits in each country:
It’s best for consumers: By forming one strong, well-resourced classifieds platform in each country, we will make it faster and easier than ever for people to trade and turn their items into cash. This accelerates our mission of helping people improve their lives through facilitating win-win exchanges.
Increased expertise: Schibsted has a long history of building high-quality classifieds platforms and will bring specific expertise to the table (e.g. content moderation, desktop engagement, verticalisation, monetisation).
Faster market development: We will share the costs of building consumer awareness about the benefits of a vibrant online classifieds market.
Building the OLX brand: We will strengthen the OLX brand by using it for two of the new joint ventures. This is a reflection on the exceptional work we’ve all done to date to build our brand.
The deal
The structure of each deal is different in each country, and the different share ownerships have been determined by the relative operational size of our existing businesses in the country. Other factors are involved too, particularly how we best maximise our combined shareholder value. For example, In Brazil, we would merge our operations to create a 50-50 joint venture and use the OLX brand.
In Indonesia, we would create a joint venture with a 64-36 majority ownership for Naspers and also use the OLX brand.
In Thailand, the new joint venture would have a 56-44 majority ownership for our partners. We have yet to make a decision on the brand in Thailand.
Finally, in Bangladesh, the new joint venture will have a 51-49 majority ownership for our partners, and the existing Ekhanei.com brand will be used. This decision on brand reflects the marketing investments that Telenor has made to date.
In all our other markets outside of these four countries our strategy is unchanged and executional excellence remains the priority.
What happens next?
As I mentioned, we have communicated the announcement to our teams in each country, and our team in Argentina. We expect the competition authority decision in early 2015, and until then, we have asked everyone to continue the progress we have been making. So it’s business as usual at Classifieds.
We know there will be lots of questions, particularly from the teams in the deal countries. Some answers we are able to give during the employee briefings, but others need to wait until we have the approval to proceed with the deal. We’ll try to minimise any uncertainty over the next few months by keeping everyone informed the moment we have any more information to share.
This news will attract media attention, and where relevant, the in-country teams will handle this reactively. If the media approaches you directly, please refer them to your regional CEO.
Finally, it just remains to be said that I feel extremely energised by today’s announcement. I am very proud that all your efforts have enabled us to make this deal, and I hope you are proud too.
This is a great step forward for Classifieds.
BR
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