Cox Automotive buys stake in Mahindra First Choice

Cox Automotive buys stake in Mahindra First Choice
Highlights

It is not about an IndianBlueBook versus Kelly Blue Book at some point of time. This is the might of the Kelly Blue Book being thrown behind the IndianBlueBook, he added.

Hyderabad: US-based digital marketing company Cox Automotive has acquired a significant strategic stake in Mahindra First Choice Wheels, the used-car retailing unit of Mahindra & Mahindra The transaction saw one of Mahindra First Choice's early investors, HDFC, selling its entire stake. Phi Advisors, an initial private equity investor in the company, also sold a part of its stake.

"There is an enormous global synergy building in this space. It is not a money-raising exercise. It is about bringing a strategic input," said Anand Mahindra, Chairman, Mahindra.

It is not about an IndianBlueBook versus Kelly Blue Book at some point of time. This is the might of the Kelly Blue Book being thrown behind the IndianBlueBook, he added.

Cox Automotive with $17 billion annual revenue owns AutoTrader, the largest digital automotive marketplace in the US, and vehicle research platform Kelley Blue Book. Mahindra First Choice owns IndianBlueBook.com, an online vehicle valuation company.

Mahindra First Choice had raised Rs 94 crore from San Francisco-based hedge fund Valiant Capital in March. The deal gave Valiant a 13.36 per cent stake, valuing the company at about Rs 700 crore at the time.

Mahindra First Choice is one of the few companies in this space in India to be profitable. It reported a profit of Rs 1.92 crore on revenue of Rs 44 crore in fiscal 2015. According to Chief Executive Nagendra Palle, revenue is expected to hit Rs 70 crore this year.

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