After being one of the first directory companies to enter the classified market, Telstra’s Sensis has put its Trading Post property up for sale. According to a report in The Age, “Sensis paid $636 million for the fading publication three years ago, but after continuous revenue declines and senior executive departures, The Trading Post is back on the block for a price believed to be no higher than the telco paid in March 2004.”
The motivation to sell the property seems to have come after the departure of John King, who appeared to be the last major supporter of the venture. This is startling news given Sensis’ much-touted strategy of bringing together businesses and consumers in an open trading environment. Sensis has had the golden touch with most of its ventures, so the failure of The Trading Post seems at odds with the company’s goal of being the local medium of choice in Australia. The article reports: “It is believed Sensis has prepared sale documents for the Melbourne-based company and major media groups, including Fairfax Media (owner of The Sunday Age), are already negotiating. The timing of the sale coincides with intense interest in media assets by private equity-backed groups.”
With other directory players such as Eniro and Canada’s Yellow Pages Group making similar investments in trying to merge classifieds and directory content, along with the recent announcement by LiveDeal and YP.com, it is not clear how this acquiescence by Sensis will affect the outlook and investment on similar prospects.