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Malaysia's Used Car Site Carsome Eyes US SPAC Traditional IPO

Malaysia’s Used Car Site Carsome Eyes US SPAC, Traditional IPO

June 21, 2021 at 03:16AM
by PYMNTS

Online used car platform Carsome has begun considering going public, a Bloomberg report says.

The company, which is based in Kuala Lumpur, has begun considering a U.S. initial public offering (IPO). That would also make it the first Malaysian unicorn. The listing might also be a merger with a special purpose acquisition company (SPAC) or a conventional IPO — it’s not clear yet, according to those with knowledge of the matter spoken to by Bloomberg. But there might be a deal before the year’s end, those sources told Bloomberg.

With the IPO, Carsome could seek around $2 billion in valuation.

Currently, the company is looking at conducting a pre-IPO funding round, hoping to raise $150 million.

But if Carsome ends up valued at $2 billion, it could join the ranks of others in its region which plan to list in the U.S. with the help of blank check firms, including Tiket.com, based in Indonesia, and the Singapore-based PropertyGuru and Grab.

Carsome, founded in 2015, sells around 40,000 cars per year. The company has a transaction value of over $600 million, and has worked with around 8,000 used car dealers. Those dealers have also made more than 2.3 million bids, Bloomberg writes.

Among the numerous pandemic trends that upended the world of business, digital car sales saw a boost. PYMNTS writes that the digital car sales were up because of the realization from customers that they don’t have to take all the time out of their day to go and look at cars in person anymore.

According to Paul Hennessy, chief executive of online car selling platform Vroom, that company allows users to browse an online search database and find a car that suits their need.

And Carsome hasn’t been the only company reaping the benefits, with U.K. car platform Cazoo getting $310 million in funding last October. Cazoo’s model involves buying and refurbishing the vehicles and then selling them online.