Trader Classified Media N.V.
Trader Classified Media N.V.
Incorporated: 1987 as Hebdo Mag
Sales: EUR 442.7 million (2002)
Stock Exchanges: Paris
Ticker Symbol: TRD
NAIC: 511120 Periodical Publishers; 511140 Database and Directory Publishers
Trader Classified Media N.V. is a leader in classified advertising, with operations in 21 countries in North and South America, Europe, Russia and the Commonwealth of Independent States (CIS), Australia, and elsewhere. It publishes classified advertising in print as well as electronic media. At the end of 2002 it claimed to connect buyers and sellers through its more than 350 publications and more than 60 web sites.
Trader Classified Media began as a small private company called Hebdo Mag in Canada in 1987. The company has gradually expanded internationally through acquisitions. It has established major offices in Paris and Amsterdam. In 2000 it went public and changed its name to Trader.com. The company became known as Trader Classified Media in September 2002. Although publicly traded, the company remains under the control of cofounder and CEO John MacBain.
Expanded Internationally As a Private Company: 1987–2000
Hebdo Mag began operating in Canada in 1987 with three weekly publications (“Hebdo” is a French term for “weekly”) that sold automobiles and other goods through classified advertising. Hebdo Mag and Auto Hebdo were published in Quebec, while Auto Trader served western Canada. The company was founded by the husband and wife team of John MacBain and Louise Blouin MacBain, and they shared the duties of CEO until 2000.
In 1989 the company acquired Winnipeg Buy and Sell and Winnipeg Auto Trader. It made its first European acquisition in 1990, when it acquired the French publication La Centrale. This weekly classified publication specialized in automotive and real estate listings and was a leader in the classified automotive sector around Paris. Hebdo Mag acquired another French publication in 1992, Les Annonces du Bateau. This specialist monthly magazine for classified boat ads was founded in 1979. In 1993 Hebdo Mag acquired a 50 percent share of a new start-up French publication, J’Annonce. This weekly free classified ads paper sold a variety of merchandise, including cars and vehicles, computers and communications equipment, household equipment, and real estate, and also listed jobs and personals in its classified ads. From the start, listings in J’Annonce were available online through the French Minitel network, and an Internet version was launched in 1997.
During the early 1990s Hebdo Mag expanded into other European countries, purchasing Auto Biznes in Poland in 1992, Gula Tidningen in Sweden in 1993, and Expressz in Hungary in 1995. When it was acquired in 1993, Gula Tidningen was Sweden’s largest classified advertising publisher. It had been in business about ten years. The paper offered a wide range of merchandise and also listed jobs, personals, and real estate, among other categories. Expressz was established in 1984 and offered a similar range in its classified ads. These three north and central European titles remained Hebdo’s leading publications in their respective countries over the next decade. In 1995 the company also expanded its North American holdings by acquiring Canada’s Computer Paper and the Trader and Traders’ Post in the United States. Computer Paper specialized in selling computer equipment and had a French-language counterpart, Québec Micro!, while the two U.S. publications offered a variety of goods and services in their ads.
In the second half of the 1990s Hebdo Mag continued to expand geographically through acquisitions. The company’s acquisition strategy was guided by its goal of achieving a dominant market position, either in national classified advertising, major metropolitan areas, or diverse markets. At the same time Hebdo began its online strategy in 1996, launching a series of online classified ad sites to serve different countries and markets. In 1996 the company acquired a leading classified advertising brand, Via Via, in The Netherlands, which further strengthened its position in northern Europe. Under Hebdo Mag, seven regional editions of Via Via provided national coverage from Amsterdam to Utrecht.
In central and southern Europe, Hebdo acquired Cerce e Trova in Switzerland and Secondamano in Italy in 1996. Cerce e Trova served the Italian-speaking population of Switzerland. Hebdo developed Secondamano into the leading classified advertising publication in northern Italy. By 2002 this free ad, paid circulation title was published in 18 regional editions throughout the major metropolitan markets of northern Italy.
In 1996 Hebdo also expanded into Russia and Taiwan. In Russia the company acquired Pronto Moscow, while in Taiwan it entered into a joint venture and acquired a share of Car News Publication, which published Car Buys, Car Deals, and Car News. Russia and the CIS proved to be a good investment for Hebdo. By 2002 the company was publishing 78 titles there, including the Russian-language edition of Golf Digest, and the region accounted for 18 percent of the company’s global revenue.
In 1997 Hebdo acquired Segundamano in Argentina and Quebec’s Publications d’Occasion. Segundamano offered a wide variety of new and used goods and services, while Publications d’Occasion published several specialized automotive weekly papers that were sold throughout Quebec and in parts of Ontario and New Brunswick.
In 1997 and 1998 Hebdo underwent a brief change in ownership before it was reacquired by its management group. In October 1997 CUC International, a consumer marketing company, acquired ownership of Hebdo for $440 million in stock and the assumption of about $200 million in debt. CUC International subsequently merged with hotel franchiser HFS Inc. in December 1997 to form Cendant Corporation. In 1998 Cendant decided to sell Hebdo back to its managers for $522 million in cash and stock. The sale was completed in December 1998. At the time of the sale Hebdo was based in Paris and known as Hebdo Mag International, Inc. It published more than 180 titles and operated in 15 countries through print and electronic media.
In 1998 Hebdo received a substantial infusion of capital when French investment firm CGIP purchased a 30 percent equity interest in the company. That year the company also expanded into Spain and Australia. In Spain, it acquired Segundamano, a leading free ad, paid circulation publication. Through the acquisition of the Segundamano brand Hebdo achieved national market leadership in Spain and developed 13 specialized, vertical publications. Hebdo also entered the Australian market with the acquisition of the Melbourne Trading Post and the Personal Trading Post of Brisbane.
In 1999 Hebdo made two acquisitions in South America. It purchased Brazil’s Jornal Balcão, which was based in Rio de Janeiro and was the country’s only paid distribution, general classified ad publication. In Colombia, it purchased a 70 percent interest in Lα Guia, a real estate catalog aimed at real estate buyers of new housing in the country’s three largest cities: Bogotá, Medellin, and Cali. Hebdo extended the Lα Guia brand in September 2002 with the launch of La Guia Clasificados, the country’s first free advertising publication. Other acquisitions in 1999 included Canada’s BC Auto Trader and France’s Garantie System.
More Acquisitions and Launching As a Public Company: 2000–03
Hebdo went public in April 2000 and changed its name to Trader.com. The parent company, Trader.com NV, had its headquarters in Amsterdam. The company also adopted a new tagline, “The International Marketplace Around the Corner.” Initial public offerings were held on the NASDAQ and the Premier Marché of the Paris Bourse. For 1999, the company reported revenue of EUR 283.3 million, an operating loss of EUR 17.7 million, and a net loss of EUR 72.1 million.
During the second half of 2000 the company made several acquisitions. In Canada it acquired Bargain Finder, which operated in Calgary and Edmonton. Bargain Finder had a 25-year history of being Alberta’s leading online and print classified publication. The company also acquired Vancouver’s Buy & Sell. In Quebec it purchased Visitenet.com, a Montreal-based web site that specialized in real estate listings.
Trader.com expanded its operations in The Netherlands with the purchase of De Partikulier. De Partikulier was established in 1987 and published classified ads in print and electronic media. Following the acquisition, De Partikulier began publishing its ads under Trader.com’s Via Via brand.
In France the company purchased an online auction site, epublik S.A., and acquired a 60 percent interest in Netclub, a leading web site for dating. Trader.com also entered the German market in 2000 with the acquisition of two leading German classified advertising companies, Avis and Revier Markt, for EUR 130 million. Both companies operated regional web sites in Germany listing Internet classified ads.
Our strategy is to achieve leadership in our chosen markets. The company’s strong organic growth is driven by effective business management, the introduction of new products and services and active brand promotion. Overall growth is also driven by selective acquisitions.
The company has a robust and sustainable business model concentrating on the core content categories of: Automotive, Real estate, and General merchandise.
The diversity of our markets, customers, products and channels makes this a resilient business, very well positioned to continued growth.
In November 2000 Louise T. Blouin, the former wife of cofounder John MacBain, announced she was resigning as co-CEO of Trader.com NV. Following her resignation the company’s executive management team was led by John MacBain, president and CEO, and Didier Breton, chief operating officer. For the year the company reported revenue of EUR 372.9 million. The company’s operating loss grew to EUR 138.4 million, and its net loss was EUR 172.1 million. At the end of the year the company operated 281 publications in 18 countries.
Among Trader.com’s acquisitions of 2001, perhaps the most significant took place in Australia. After acquiring Sydney Buy & Sell in 2000, Trader.com purchased a 70 percent controlling interest in Australia’s Trading Post Group, the largest classified advertising publisher in Sydney and Adelaide. In business for 33 years, the Trading Post Group published 11 periodicals. It had a web site that boasted seven million page views per month. With some 400 employees, the Trading Post Group generated revenue of EUR 25.7 million in 2000. Around the time that it acquired Trading Post Group, Trader.com relaunched Autotrader.com in Australia as a national web site. In 2002 Trader.com purchased the remaining minority interest in the Trading Post Group, thus consolidating its position in Australia and giving the company complete coverage throughout the country.
Other developments in 2001 included the acquisition of L’Erbavoglio in Switzerland and Trajín in Spain. In France Lα Centrale launched the first entirely interactive automotive classified ad service on TPS Satellite Television in conjunction with Minisat. In October 2001 Trader.com sold off four advertising papers and one web site located in California to Target Media Partners. Included in the sale were the brands Great Northern Wheels and Deals, Photo Ad, and Easy Ad.
For the year 2001 Trader.com reported consolidated revenue of EUR 419.1 million, an increase of 12 percent from EUR 372.9 million in 2000. Print media accounted for EUR 393.6 million of revenue, while online revenue reached EUR 25.5 million, a 48 percent increase over EUR 17.2 million from online sources in 2000. Despite weakening markets in North America and South America, the company was able to report overall revenue growth due to its international presence and leading local brands. At the end of the year Trader.com operated nearly 300 publications and some 60 web sites in 19 countries. It had 5,100 employees, including 2,000 sales people.
In September 2002 Trader.com changed its name to Trader Classified Media N.V. to reflect its position as a market leader in classified advertising. In October 2003 an announcement was made that clarified future ownership of the company. Cofounder and CEO John MacBain stated his intention to purchase the remaining shares owned by his former wife, Louise T. Blouin, and increase his ownership interest in the company to about 50 percent. In addition, he would increase his holdings to 68 percent of the voting interests. French investment firm Wendel Investissement owned about 30 percent of the company. In December 2002 the company announced that it would delist its stock from NASDAQ to concentrate on the Paris Bourse Premier Marché, which had always been the primary trading market for the company’s stock. Less than 3 percent of the company’s total stock volume was traded on NASDAQ.
International developments in 2002 included consolidating its position in Australia and achieving full ownership of the Trading Post brand there. In France the company launched a new prestige automotive title, Auto Première, which featured ads for premium used vehicles. The first issues were bundled with La Centrale. The company also initiated a new direct marketing program in France that provided sales leads of people who had recently sold their vehicles to French manufacturers, auto dealers, and finance companies. Another direct mail initiative was introduced in North America, which involved the launch of a full-color publication featuring car dealer ads that was mailed to people who had recently sold their used vehicles.
In Italy the company launched two new publications, il Fé in Ferrare and il Rò in Rovigo, while new editions based on the Segundamano brand were launched in Pavia, Savona, and Como-Lecco in northern Italy. Auto Facile, a new direct mail publication, was introduced to deliver targeted offers from auto dealers and services directly to the homes of private vehicle sellers. In addition, a variety of new online services were introduced based on a paid access business model.
In North America the company launched 13 new print titles during 2002. Overall, North America accounted for 24 percent of Trader Classified Media’s global revenue. The company published 148 print titles in North America, focusing on the categories of automotive, real estate, general merchandise, and computers. In addition, there were 12 North American Internet sites that offered the same content and categories as the print publications.
In north and central Europe the company operated in Sweden, Hungary, Poland, and The Netherlands. In Hungary the company extended its Expressz brand by launching new specialist titles in automotive, real estate, and heavy equipment categories. In October 2002 the company acquired Mai Hirdetés, a free ad, paid circulation title with national coverage that had been in business for about ten years.
In 2002 Trader Classified Media published 63 titles in Russia and the CIS. During the year the company added new editions in eight cities. The company also operated seven web sites there, the foremost being v Glaza xGlaza (Eye to Eye), which was the country’s leading personals site. In 2002 Russia and the CIS accounted for 18 percent of Trader Classified Media’s global revenue.
- The company is founded in Canada as Hebdo Mag by John MacBain and his wife Louise Blouin MacBain.
- The company acquires its first European publication, La Centrale, in France.
- Hebdo Mag acquires the Trader and Traders’ Post in the United States.
- Hebdo Mag launches its first web site.
- French investment firm CGIP purchases a 30 percent equity interest in Hebdo Mag.
- The company goes public as Trader.com N.V., with an initial public offering (IPO) on NASDAQ and the Premier Marché of the Paris Bourse.
- The company changes its name to Trader Classified Media N.V.
Spain and Latin America accounted for 13 percent of Trader Classified Media’s worldwide revenue in 2002. The company launched its paid access business model in Spain in 2001 and expanded it there and in other markets in 2002. Paid access services principally involved online and telephone access to additional classified listings for a fee. They also included ad renewals, ad placement, and voice-mail services.
Trader Classified Media became profitable in 2002, reporting net income of EUR 10.5 million on revenue of EUR 442.7 million. Print media accounted for EUR 411.5 million in revenue, while online revenue reached EUR 31.2 million. For the future the company planned to continue growing organically as well as through acquisitions. It planned to expand its classified advertising in both print and electronic media. In 2003 it acquired Webseduction.com, the leading online dating site in Canada; the leading classified advertising brands in Mexico City; and the leading local directory publisher in Hungary. The company also leveraged its content to offer paid business services, and it was developing new revenue sources through direct mail efforts tied to its classified advertising activities.
Canada Trader.com; Trading Post Group Pty Ltd. (Australia); Expressz Hungary Rt.
“Our Company,” http://www.trader.com, August 5, 2003.
“Timeline,” http://www.trader.com, August 5, 2003.
Ward, John T., “Connecticut Conglomerate Cendant Corp. to Sell Classified Ad Subsidiary,” Knight Ridder/Tribune Business News, August 13, 1998.X
—David P. Bianco