Online classifieds operator, Carsales.com will acquire a controlling shareholding in SoloAutos, a leading automotive classifieds website in Mexico.

As part of the transaction, Carsales.com will acquire a 65 per cent stake in SoloAutos, with the existing owner, Jose Antonio Ramrez, retaining the remaining 35 per cent stake and continuing in his current role as CEO.

“Mexico represents an attractive market in a number of significant respects,” said Paul Barlow, Carsales director international. “It is the second largest economy in Latin America with internet usage nearing 50 per cent of a population of over 120 million people. We see a great opportunity in this relatively new online auto classifieds market in a growing automotive industry.”

“The SoloAutos team has built a great business. We look forward to partnering with SoloAutos and utilising Carsales’ expertise, experience and technology to rapidly expand the business across Mexico,” said Carsales CEO, Greg Roebuck. “SoloAutos is a great addition to our portfolio of international assets and provides a significant platform for growth.”

Commenting on the acquisition, Jose Antonio Ramrez said, “My team and I are excited to join the Carsales family which is one of the world leaders in online automotive classifieds. We believe it is the best partner for SoloAutos and I look forward to working with the team to grow the business to its full potential.”

Carsales’ investment will be up to US$9 million. This purchase price includes a working capital investment to assist in the funding of growth opportunities and includes an earn out component which is subject to SoloAutos achieving certain performance targets. This investment is not expected to have a material earnings impact during the first year after completion.

A small number of largely process based conditions are to be completed before finalising the transaction, which Carsales anticipates will occur in the next few months.