Axel Springer Split Rumours: A Benefit to its Classifieds Business?

News emerged over the weekend that Axel Springer may be open to a major split of its major two segments with its international media business remaining under the ownership of current CEO Mathias Döpfner, and its European classifieds division going to its largest shareholder, private equity firm KKR.

Sources told The Financial Times that "Axel Springer’s classifieds business is faster-growing and more profitable than its media business," a piece of useful information coming out of a company that went private in 2019 and therefore has no obligation to share its progress publicly.

Assuming KKR is serious about taking on Aviv (Axel Springer's real estate division) as a focused, priority investment, it will target growth under new management after some high-profile cuts and controversies at Axel Springer in recent years: including allegations of press interference and sexual harassment.

Controversy hasn't been limited to the holding company. It also bled into Aviv Group last September when SeLoger (France) was accused of illegally collecting user data via its mobile app.

The European Center for Digital Rights accused SeLoger of "illegally accessing and sharing users’ data with third parties for sophisticated analytics as soon as the apps are opened" including IP addresses and the model and brand of their phone.

Even on a strategic level, SeLoger angered agents in 2023 when it started allowing FSBO listings on its real estate portal, bypassing the agents who pay a subscription to feature on its site.

Axel Springer and Aviv in context

Aviv Group has been active this year. Piet Derriks became MD at Immoweb Germany in August before the Group sold its Spanish real estate business Housell earlier this year.

Axel Springer is also open to divestments: just last week, it divested its Spain assets when it sold Axel Springer España—including Business Insider España, Autobild España, Hobby Consolas, Retro Gamer, Computer Hoy and Top Gear—to media company Henneo.

Axel Springer España didn't operate any real estate classifieds assets.

Where is the growth potential for a new owner?

An investor like KKR—already an accomplished real estate investor of its own accord—would see the acquisition of Axel Springer's classifieds segment as a coup. In particular, Aviv Group becoming a smaller, independently held asset would make it easier to manage, grow and sell further down the line.

In France, SeLoger has been the leading real estate portal for over 20 years, with spin-off portals for new builds and commercial real estate under the Groupe SeLoger umbrella. Aviv also has a market-leading presence in the smaller Belgian market.

The biggest opportunity probably lies in Germany, where Aviv's German portal Immowelt competes against market leader ImmoScout24 (owned by Swiss Marketplace Group (SMG)).

As a private entity, it is hard to judge how close Aviv and Immowelt are to Scout24 (and SMG), but Similarweb data shows that Immowelt received 12.9 million web visits in August 2024, while ImmoScout24 achieved 40.2 million visits in the same period.

Meanwhile, the publicly-owned Scout24 continues to record high profits and revenue growth:

If Axel Springer and Aviv find themselves in the hands of new owners, Germany will be the likely play.