Kuala Lumpur-headquartered iCar Asia said that it had entered into a binding agreement to acquire Carmudi’s business unit in Indonesia, a move to capture the growth in Southeast Asia’s growing online used car sales market.
The deal is expected to be completed on October 15, 2019, according to an official statement.
The USD 3 million deal will be paid in two installments, 2 million dollars upon completion and the remaining 1 million on October 15, 2020, per the statement.
Australia-listed iCar Asia claims to be the largest network of online automative sites in Southeast Asia that has the potential to connect over 600 million car buyers and sellers across the region. Founded in 2012, it entered Indonesia after it acquired car classifieds site Mobil123 in 2014.
Backed by Rocket Internet, Jakarta-based Carmudi is an online car marketplace operates in Indonesia and the Philippines. It raised USD 10 million of Series C round in January from Asia Pacific Internet Group.
Carmudi is one of the largest automotive sites in Indonesia with more than two million visits per month. It also operates five brick-and-mortar car sales centers called “Carsentros”. These are the transaction hubs for car dealers in addition to providing car financing among other things.
The used car marketplace business is heating up in Southeast Asia as the vehicle sales in the region has been consistently growing every year, which drives a boom of second-hand sales in the coming years.
Several notable automotive marketplace startups in the region are Carro, BelimobilGue, and Carsome. In early August, Carro raised USD 30 million in its ongoing Series B round. It has acquired Indonesian marketplace platform Jualo to accelerate regional expansion. Not long after, its competitor, BeliMobilGue also received an investment commitment of USD 30 million from Berlin-based JV partner Frontier Car Group (FCG) to help expand its business.
The acquisition of Carmudi speaks to iCar Asia’s determination to hold up itself in the face of heated competition. The company expects to double its Indonesian business’s revenues and ramp up its growth in the country, which in turn will contribute to its goal of becoming breakeven as a whole in Southeast Asia by 2020.