WUBA spin-off Guazi used car business, Hina serves as Exclusive Financial Adviser
BEIJING, Nov. 25, 2015 /PRNewswire/ -- 58.com Inc. (NYSE: WUBA) ("58.com"), China's largest online marketplace serving local merchants and consumers, today announced its plan to spin off (the "Spin-off") one of its subsidiaries, Guazi.com Inc. ("Guazi"), which operates 58.com's consumer-to-consumer (C2C) used car trading platform, to enable potential faster growth of the platform.
Following an independent third-party valuation assessment, 58.com has entered into a definitive agreement to divest a controlling ownership stake in Guazi to Mr. Mark Haoyong Yang, co-Chairman and co-CEO of 58.com, in exchange for a cash injection from Mr. Yang into Guazi. Following the injection, 58.com will retain an estimated 46% stake in Guazi. Mr. Yang, the founder, former Chairman and CEO of Ganji.com, will serve as Chairman and CEO of Guazi and has resigned from his position as the Co-CEO of 58.com, effective immediately, but will remain the co-Chairman of 58.com's board of directors. The Spin-off is expected to be completed in the near future.
Founded in 2014, Guazi is a rapidly growing C2C used car trading platform which directly links individual car sellers and buyers. Fragmentation and lack of credibility are key weaknesses in today's used car market in China. To build credibility and increase buyer confidence, Guazi lists used cars that have been certified by its highly experienced technicians and certification professionals. Guazi also provides a full suite of value-added after-sales services, including vehicle financing and auto insurance. Guazi's services covered 40 cities in China as of September 2015. Guazi believes that it offers higher quality used car inventory and better service compared with rival platforms.
The Spin-off is expected to allow greater management focus and funding flexibility for a business that is ideally positioned to take advantage of the significant growth opportunities present in the transforming and growing used car market in China.