Shriram Transport Finance Company said it has decided to sell a majority stake in its vehicle auction company Shriram Automall to Cartrade.com to create what it called India’s leading used vehicle platform.
CarTrade, owned by MXC Solutions India, will acquire majority stake in Shriram Automall India Limited (SAMIL), India’s offline auction platform for pre-owned vehicles from Shriram Transport Finance for Rs 156.37 Cr.
As part of the deal, CarTrade will outsource its auction business to Shriram Automall and sell to Shriram Automall its sake in Adroit Inspection Services Pvt. Ltd., which offers services like valuation & inspections to Insurance and Banks & NBFC industry.
Automall will acquire 100% equity in Adroit Inspection Services Pvt. Ltd. from CarTrade by paying Rs 13 Cr.
Sameer Malhotra, who will continue to be the CEO of Shriram Automall, said his company is already growing at 30% a year. “We were looking for more innovative thought partners to grow multi-fold at over 50% in coming years,” he said. Shriram Group, he said, has around 5 million customers.
“Joining hands with CarTrade Exchange will add another 5 million digital customer base, besides their technology expertise. This partnership will result in an immense increase in business transactions.
“We’re having years of expertise into commercial vehicle segment, with this partnership will be aiming to create new and unique value propositions in passenger vehicle market as well.”
Shriram Transport Financial did not say what percentage of the company would remain with it.
However, it did say that Shriram Automall expects to double its business in the next 3 years.
“This proposition will not only create an enhanced market place for transaction of pre-owned vehicles & equipment but also add value proposition to business via technology & digital expertise,” said Umesh G. Revankar, Managing Director and CEO of Shriram Transport Finance.
“Together this will also open avenues for us to enter into new segments of vehicle finance and we’re confident to go further and serve our customer with better solutions & services.”
Vinay Sanghi, Founder and CEO of CarTrade said his company was looking for a player with physical presence all around the country to support its online marketplace.
“We’re happy to come together with STFC and SAMIL to provide holistic solutions to our customers.”
Shriram Transport Finance Company is the flagship company of the Shriram group which has significant presence in Consumer Finance, Life Insurance, General Insurance, Stock Broking and Distribution businesses.
Established in 1979, Shriram Transport is today the largest asset financing NBFC in the country and one of the top finance providers for the commercial vehicle industry.
It has 1035 branch offices, with the headquarters in Mumbai. The company manages assets over Rs 85,000 cr and claims to have a “live” customer base exceeding 16.20 lacs.
CarTrade.com & CarWale.com are an online platforms for getting information about and trading in cars.