)
The ASX-listed company formerly known as The Market Herald has received approaches from third parties to buy the very business it was spawned from - stock trading and investment forum HotCopper.
Gumtree Australia Markets (ASX:GUM), the company's second name change in 15 months after a brief stint as The Market Limited, revealed this morning it had been approached by "several parties" regarding the potential purchase of its Capital Markets businesses comprising HotCopper in Australia and Stockhouse in Canada.
The sites power two of the largest investor communities in Australia and North America with around 12 million investors interacting with the platforms each year.
"The board is considering these unsolicited approaches and will keep the market updated in accordance with its continuous disclosure obligations should material terms be finalised," Gumtree Australia Markets chief executive officer Tommy Logtenberg said in a statement to the Australian Securities Exchange (ASX).
"The company has not made any decision on the Capital Markets business and there is no certainty that any transaction will result, or if so on what terms, following these approaches."
The group's new name is a reference to the classifieds platform Gumtree it acquired alongside Carsguide and Autotrader from Norway-based Adevinta in 2022 for US$60 million ($86.7 million).
The entire group, including classifieds, the investor forums and news platform The Market Online, has a market capitalisation of just $30 million, which is less than its outstanding balance of $35 million.
This follows a $3 million pay down of debt to Commonwealth Bank (ASX: CBA) in the December half as part of the group's deleveraging efforts, as operational earnings improved.
Whilst total revenue declined by 9 per cent to $48.6 million in the period, EBITDA almost quadrupled to $3.2 million and its statutory loss was halved to $1.2 million.
Revenue from its Carsguide and Autotrader brands was up by 10 per cent driven by "incremental products offered and a strong demand", but soft market conditions led to a decline in advertising revenue while less investor activity led to lower revenues on HotCopper and Stockhouse.
"Within our Capital Markets business, strategy has been set and we continue to invest in an improved user experience for HotCopper and Stockhouse leveraging all the key learnings and insights across the two sites," Logtenberg said in February.
"Our Capital Markets business has successfully reduced its cost base and new product initiatives will be rolled out in coming months. Both of which will have a positive impact on our results in H2 FY25."
, the recently rebranded iteration of The Market Herald which for just over a year traded as The Market Limited until this February,
)
