AP Eagers chief executive Martin Ward says the company is committed its CarsGuide venture with News Corporation following the listed car dealer's purchase of the local Autotrader website.
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AP Eagers is one of the car dealer consortium partners in CarsGuide, holding a 7.5 per cent stake. It is 50 per cent owned by News Corporation.
Mr Ward assured Fairfax Media that AP Eagers was committed to CarsGuide, but would not reveal what his plans were for the Autotrader business.
Autotrader is a well-known classifieds brand in the United States, although the US operation is owned by a separate business.
Mr Ward, who sits on the CarsGuide board, said the purchase was not material to AP Eagers so the announcement was not made to the stock exchange.
AP Eagers beat out online classifieds heavyweights Carsales.com.au and CarsGuide for the Autotrader business. Sources said the sum was close to $3 million.
It is understood that the deal was agreed to last Friday and transfer of the Autotrader brand will happen in the coming months.
AP Eagers for the six months to the end of June reported net profit of $44.1 million, up 32.2 per cent from $33.3 million in the previous corresponding period.
Shares in the car dealer have shot up close to 90 per cent over the last 12 months to $10.70.
AP Eagers has been active in the market recently; in November it agreed to acquire car and truck retail businesses of the Birrell Motors Group.
As revealed by The Australian Financial Review's Street Talk column, Hunter Five, who was the seller of the Autotrader brand, engaged with Lempriere Capital Partners to run the sale process and preliminary information was sent to prospective buyers in late October.
"It was very simple for us. The reality was that we were approached by a number of domestic and international firms within a relatively short period of time," Hunter Five chief executive Ash Hunter said.
"We purely thought that maybe the brand was worth more to somebody else than it was to us."
Elsewhere in car classifieds, Fairfax Media is partnering with The Motor Report in a 50:50 joint venture targeting the new car sales market.
The venture will be headed by former Carsales.com.au executives Shane Pettiona, who will become a director, Anthony Pettiona, who will be chief executive, and Con Lagos who will become national dealer director.
It will operate under the Drive brand and its URL and the Drive print sections will continue to be published across Fairfax's publications.
"The aim of the joint venture is to strengthen and maintain Drive.com.au's position as Australia's premier trusted automotive editorial brand, and use that as a launch platform to create Australia's premium destination for new car buyers," Anthony Pettiona said.
Shane Pettiona said the venture will look to help consumers all the way through the sale process, from the thought to buy a new car right up to the transaction.
"Drive.com.au is one of the most powerful mastheads in automotive media with a vast readership of buyers researching the second-biggest product purchase they will make in their lifetimes," he said.
