OLX Group, the online classifieds business of Prosus, a global consumer internet group and technology investor, will invest up to $400 million in Berlin-based online car marketplace Frontier Car Group (FCG), the company said on Monday.
Last year, OLX India entered into a joint venture with FCG to launch OLX CashMyCar, a platform to buy and sell used cars in India. The statement added that in India, OLX and FCG share technological resources, expertise and knowledge to build and operate OLX CashMyCar stores.
OLX Group’s new investment of up to $400 million, comprises a primary injection of capital in FCG, the contribution of OLX’s joint-venture shares in India and Poland, as well as the acquisition of shares held by early investors subject to a tender offer process, the statement added. OLX invested $89 million in the Berlin-based startup in May last year, through its early-stage investment arm.
Martin Scheepbouwer, CEO of OLX Group, said, in the statement, “Together with FCG, we are aiming to build the leading global used car marketplace, offering a premium and convenient service to millions of car buyers, sellers and dealers. We’re in a unique position to accelerate the expansion of this platform worldwide.”
“Our joint venture with FCG in India will enable us to grow OLX CashMyCar as the leading pre-owned car offline marketplace by offering a reliable and convenient service to the entire pre-owned car ecosystem comprising of car buyers, sellers and dealers. OLX CashMyCar stores have tripled their presence across India in the last year and car purchase volumes are growing by 10% month-on-month with over 1 million users being engaged since January 2019, ” Bhaskar Bagchi, General Manager, OLX Cash My Car, India, said, in the statement. “The low motorization rate and increasing aspiration exhibited by car buyers and sellers will enable us to expand our presence to 150 stores across 40 cities by 2021 from 75 stores across 17 cities currently,” he added.
Sujay Tyle, co-founder and CEO of Frontier Car Group, said, in the statement, “FCG has nearly tripled performance across every key metric since the first OLX Group investment less than 18 months ago and has expanded to four new countries in that time. Together with OLX and Prosus, we are aiming to revolutionize the pre-owned car market in India by adding trust, transparency and a comprehensive suite of services to all participants in the ecosystem.”
Source: Mint