Buyers sniffing around Gumtree’s Hotcopper
Classifieds business Gumtree Australia is considering selling its investor forum Hotcopper, according to an ASX announcement.
Gumtree – previously called The Market Limited, The Market Herald, and Hotcopper Holdings – has had a rocky ride since 2022, with the ouster of a CEO, an official rebuke from The Takeover Panel, and significant board turnover. Company accounts show the business losing money through 2024 and into this year.
Gumtree’s ASX announcement said it had “been approached by several parties” for Hotcopper in Australia and Stockhouse in Canada.
“The Board is considering these unsolicited approaches and will keep the market updated,” the note said.
Gumtree divides its stable into “classifieds” – Gumtree, Carsguide and Autotrader – and “capital markets” – Hotcopper, Stockhouse and The Market Online. On the capital markets side, the Market Online is a business news site while Hotcopper and Stockhouse are forums for investors. Gumtree claims its business news and forums service 12 million users annually.
Half-yearly accounts filed in February show the capital markets side of the business losing more than a million dollars on revenue of $4.7m. Revenue for the corresponding period a year earlier had been $5.9m.
Hotcopper Holdings listed in 2016, was based on the original Australian investor forum that had begun as a bulletin board in 1994. It changed its name to The Market Herald Ltd in 2020, then purchased Gumtree Australia, Carsguide and Autotrader for over $86m in 2022.
As of last night, the company’s market cap was $28.9m on the ASX.
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According to annual reports, Gumtree Australia employs 240 people across its Sydney, Perth and Vancouver offices.
It traces its roots to the Gumtree classifieds site set up in 1999 in London by Englishmen Michael Pennington and Simon Crookall. The original Gumtree was designed to appeal to expatriate Australians, New Zealanders and South Africans, and was sold to Ebay in 2005 having expanded to many markets. Ebay sold in 2020 to Norwegian classifieds group Adevinta ASA, who then offloaded the Australian operation to The Market Herald in 2022.
