Publications
Partners
Cape Town - Naspers has found a great way to work together and combine forces with rival Schibsted, CEO Bob van Dijk said in a conference call on Friday.
The conference call followed the announcement earlier on Friday that the local media giant formed joint ventures with four of its rivals in four countries.
The four firms, which include Norway's Schibsted and Telenor, said they would set up a series of joint ventures for their online classifieds businesses in Brazil, Indonesia, Thailand and Bangladesh.
The structure of the joint ventures will be:
- In Brazil Naspers will hold 50% and SNT 50% (SNT is an equal shareholding joint venture between Schibsted and Telenor);
- In Indonesia Naspers will hold 64% and 701Search 36% (701Search is an equal partnership joint venture amongst Schibsted, Telenor and SPH);
- In Thailand 701Search will hold 55.9% and Naspers 44.1%;
- In Bangladesh SNT will hold 50.3% and Naspers 49.7%.
READ: Naspers ties up with rivals to boost online offering
“We are very excited to bring together today some of the most skilled people in the industry. We know these partners share our visions and bring opportunities to develop in these countries,” said Van Dijk.
“We will share costs and expertise with one good platform in each market and make it easier for our customers to trade. We also want to cut costs, for instance.”
Van Dijk's Schibsted counterpart Rolv Erik Ryssdal said together the new partners can further develop the market place.
“The last ten years we have expanded beyond our traditional markets and Brazil, Indonesia, Thailand and Bangladesh can offer tremendous growth,” said Ryssdal.
By joining forces the partners will create more liquidity for their buyers and a bigger space for their audiences.
“So it will be better for all of us. We are covering the markets we think are the most important. I think we can now combine the liquidity in these markets and we believe over time it will allow us to monetise on the businesses,” said Van Dijk.
“We are now, for instance, on an encouraging path to build on the horizontal and vertical space in Brazil.”
“There is an opportunity to reduce some upfront spend and we are committed to success, which is the most important takeaway for these joint ventures,” Van Dijk said.
Fielding questions from mostly global financial institutions Van Dijk and Ryssdal said their joint venture is regarded as the most effective way to structure what they have in mind.
They, however, would not divulge the details of the funding of the different joint venture deals.
On whether the joint venture could be indicative of a possible similar type of joint venture for Naspers in India, Van Dijk said "India is a different market where we feel that if we invest well, we can compete well”.
Hope not Naspers' strategy
On a question of what Naspers hopes to achieve from the joint ventures, Van Dijk said "Hope is not our strategy, but rather to execute well and pursue a good strategy".
From a regulatory point of view, the deals are still subject to approval by the relevant authorities.
“We are quite comfortable when we look at the different products and, although we cannot be pre-emptive about the regulatory approval, we do believe in a positive outcome. But yes, it is a process we still have to walk through,” said Van Dijk.
As for the joint ventures’ corporate governance structures, he said there will be proportional representation in each of the joint ventures “and as for any exit rights, those will all be what you expect to see in a joint venture of this kind”.
On a question about what mobile approach will be followed, Van Dijk said whatever will bring optimal drive and the best opportunities.
READ: Naspers delivers solid performance
An eye on competition
Another question was about when the companies expect to become profitable or break even in these markets, to which Van Dijk said by joining forces much better market places were created for consumers that will, therefore, shorten the time to break even.
“There are many other competitors in all our markets and there are also new players, who are building customers and doing a great job. We have a lot of work ahead of us and these joint ventures will allow us to have a better position to also tackle other competitors,” said Van Dijk.
“With our combined liquidity we will have good offerings in the markets for our customers in these markets. Our business model will be one of solid liquidity. We take a long-term view and we have the resources to pursue a long term strategy.”
In his view the knowledge of consumer behaviour in emerging markets will add value all over for the joint venture partners.
Lastly, on a question about the protection of the individual partners’ intellectual property (IP), Van Dijk and Ryssdal agreed that even here there will be mutual benefits.
“Our final choices regarding a platforms and technologies will be made in due time and our agreement calls for adequate protection for those platforms and the IP that comes with it,” said Van Dijk.
“We are quite excited about working with new partners and we realise it is still dependent on the approvals needed.”
Naspers' share price traded 8.57% higher at R1 552.06 by 14:25.
ALSO READ: Moody's affirms Naspers outlook stable
* Fin24 is part of Media24, a subsidiary of Naspers.
The conference call followed the announcement earlier on Friday that the local media giant formed joint ventures with four of its rivals in four countries.
The four firms, which include Norway's Schibsted and Telenor, said they would set up a series of joint ventures for their online classifieds businesses in Brazil, Indonesia, Thailand and Bangladesh.
The structure of the joint ventures will be:
- In Brazil Naspers will hold 50% and SNT 50% (SNT is an equal shareholding joint venture between Schibsted and Telenor);
- In Indonesia Naspers will hold 64% and 701Search 36% (701Search is an equal partnership joint venture amongst Schibsted, Telenor and SPH);
- In Thailand 701Search will hold 55.9% and Naspers 44.1%;
- In Bangladesh SNT will hold 50.3% and Naspers 49.7%.
READ: Naspers ties up with rivals to boost online offering
“We are very excited to bring together today some of the most skilled people in the industry. We know these partners share our visions and bring opportunities to develop in these countries,” said Van Dijk.
“We will share costs and expertise with one good platform in each market and make it easier for our customers to trade. We also want to cut costs, for instance.”
Van Dijk's Schibsted counterpart Rolv Erik Ryssdal said together the new partners can further develop the market place.
“The last ten years we have expanded beyond our traditional markets and Brazil, Indonesia, Thailand and Bangladesh can offer tremendous growth,” said Ryssdal.
By joining forces the partners will create more liquidity for their buyers and a bigger space for their audiences.
“So it will be better for all of us. We are covering the markets we think are the most important. I think we can now combine the liquidity in these markets and we believe over time it will allow us to monetise on the businesses,” said Van Dijk.
“We are now, for instance, on an encouraging path to build on the horizontal and vertical space in Brazil.”
“There is an opportunity to reduce some upfront spend and we are committed to success, which is the most important takeaway for these joint ventures,” Van Dijk said.
Fielding questions from mostly global financial institutions Van Dijk and Ryssdal said their joint venture is regarded as the most effective way to structure what they have in mind.
They, however, would not divulge the details of the funding of the different joint venture deals.
On whether the joint venture could be indicative of a possible similar type of joint venture for Naspers in India, Van Dijk said "India is a different market where we feel that if we invest well, we can compete well”.
Hope not Naspers' strategy
On a question of what Naspers hopes to achieve from the joint ventures, Van Dijk said "Hope is not our strategy, but rather to execute well and pursue a good strategy".
From a regulatory point of view, the deals are still subject to approval by the relevant authorities.
“We are quite comfortable when we look at the different products and, although we cannot be pre-emptive about the regulatory approval, we do believe in a positive outcome. But yes, it is a process we still have to walk through,” said Van Dijk.
As for the joint ventures’ corporate governance structures, he said there will be proportional representation in each of the joint ventures “and as for any exit rights, those will all be what you expect to see in a joint venture of this kind”.
On a question about what mobile approach will be followed, Van Dijk said whatever will bring optimal drive and the best opportunities.
READ: Naspers delivers solid performance
An eye on competition
Another question was about when the companies expect to become profitable or break even in these markets, to which Van Dijk said by joining forces much better market places were created for consumers that will, therefore, shorten the time to break even.
“There are many other competitors in all our markets and there are also new players, who are building customers and doing a great job. We have a lot of work ahead of us and these joint ventures will allow us to have a better position to also tackle other competitors,” said Van Dijk.
“With our combined liquidity we will have good offerings in the markets for our customers in these markets. Our business model will be one of solid liquidity. We take a long-term view and we have the resources to pursue a long term strategy.”
In his view the knowledge of consumer behaviour in emerging markets will add value all over for the joint venture partners.
Lastly, on a question about the protection of the individual partners’ intellectual property (IP), Van Dijk and Ryssdal agreed that even here there will be mutual benefits.
“Our final choices regarding a platforms and technologies will be made in due time and our agreement calls for adequate protection for those platforms and the IP that comes with it,” said Van Dijk.
“We are quite excited about working with new partners and we realise it is still dependent on the approvals needed.”
Naspers' share price traded 8.57% higher at R1 552.06 by 14:25.
ALSO READ: Moody's affirms Naspers outlook stable
* Fin24 is part of Media24, a subsidiary of Naspers.
