Prosus considers sale of automotive classified advertising business

FILE PHOTO: Prosus' logo is pictured on a smartphone in this illustration taken, December 4, 2021. REUTERS/Dado Ruvic/Illustration

AMSTERDAM (Reuters) -Technology investor Prosus is considering a sale of its OLX Autos classified advertising business, the company said on Thursday.

Prosus said the pursuit of growth in the car advertising business was no longer the right approach because the second-hand car market had been hit by a "significant and persistent slowdown" owing to weakening economic growth and high inflation.

"Prosus will explore all options for the OLX Autos business, acknowledging that significant value exists within local markets," the company's statement said.

"The exit of OLX Autos will lead to a significant improvement in the profitability profile of the classifieds segment as a whole."

OLX Autos increased revenue by 84% to $1 billion in the first half of its 2022/2023 financial year, Prosus said in November, but trading losses increased to $206 million owing to investment in expansion of the direct-to-consumer business.

(Reporting by Bart MeijerEditing by David Goodman)