Autochek, a Nigerian automotive technology business, has purchased Cheki Kenya and Uganda from Ringier One Africa Media (ROAM) for an unknown sum of money, meanwhile, in a statement issued by Autocheck, it said the purchase will be finalized in the following weeks. Autochek has now completed its growth into the East African market with this acquisition, which comes roughly a year after it acquired both Cheki’s Nigerian and Ghanaian operations.
Cheki debuted in Kenya in 2010 as a virtual vehicle directory for dealers, importers, and individual sellers. The business which is Nairobi-based has expanded its operations to include Nigeria, Ghana, Tanzania, Uganda, Zambia, and Zimbabwe.
Cheki was acquired by ROAM In 2017and added it to its network of online markets and classifieds, including Jobberman. It continues to operate in Tanzania, Zambia, and Zimbabwe, according to ROAM’s website. However, because these markets are largely dormant, it is safe to assume that Autochek has bought all of Cheki’s key activities.
Cheki Kenya has 700,000 users and lists approximately 12,000 cars per month. It also claims to have grown by 80 percent year over year in the last two years, making it a critical component of Autochek’s regional expansion strategy.
In a statement, Autochek CEO Etop Ikpe stated, “Cheki Kenya has always been sort of the crown jewel.” “It wasn’t a conscious effort at the time we closed the Nigeria and Ghana deal, but it happened.”
He further added that Kenya has a higher credit penetration rate for vehicle financing than Nigeria and Ghana. The East African country has a penetration rate of 27.5%, compared to 5% for the entire West African market. As a result, it’s easy to see why Autochek is bullish on the East African market.
According to Ikpe, before completing the acquisition, the one-year-old company performed a covert trial with a few Kenyan banks to supply automobile owners with credit — a method similar to that utilized in Ghana and Nigeria. As a result, the acquisition strengthens the company’s position in the market.
Ikpe denies claims that the sale of Cheki operations in all of its major markets which took place in less than a year, was because the four entities performed poorly and forced the classifieds colossus to find a suitable buyer quickly. He explained that the deal was completed quickly because both sides recognized the classifieds model which was managed by Cheki. needed to make way for the more current transactional approach which is employed by Autochek and other leading automotive players in Africa, and as a result, ROAM Africa regarded it as a necessary change for Cheki.
Ikpe insists that selling the company to Autochek wasn’t a difficult decision because of his previous history with Ringier (one arm of ROAM before the merger), where he managed DealDey, a classifieds deal company that Ringier later bought.
“I believe it is a long-term strategy for them, and they believe in our business model. And there’s a lot of optimism that we’ll be able to accomplish things in the future. It was also about finding the ideal location for the company and its employees.”
“Across the world, we witness a new evolution of digital automotive platforms, demanding significant specialization,” ROAM CEO Clemens Weitz said in a statement.
We believe that Autochek, in particular, has the best staff and skills in Africa to deliver a game-changing consumer experience. This agreement is more than just a great deal for ROAM Africa: it allows us to focus even more on our other businesses’ strategic playbooks.”
Autochek’s entrance into East Africa comes at a time when automotive technology businesses such as Moove, Planet42, and FlexClub are attracting investor interest as the demand for flexible vehicle finance continues to expand across the continent.
South Africa is undoubtedly the continent’s most important car lending market. Other automobile firms have a presence in the industry, and Autochek’s objective is to develop there as well, which makes sense.
South Africa is the most prestigious market in the continent, with the highest car financing penetration. Despite the seeming rivalry, Ikpe feels there are potential for the company to deliver market-specific services that are different from what other companies offer.
“The beauty of our platform is that it can be used for a variety of purposes; for example, we may use it for retail or B2B. We can collaborate in a variety of dynamic ways. As a result, I believe it’s only reasonable that our goal is to be in every region. We’ve made progress in East and West Africa, and we’ll keep working as hard as we can in North and South Africa,” he said.
According to Autochek, a funding round is in the works on this front, and it might conclude before the end of the year.