Transaction Capital will have no shares in WeBuyCars after it lists

WeBuyCars Dome

Following WeBuyCars’ listing on the main board of the JSE in early April, Transaction Capital will no longer own any of the company’s shares.  

This was revealed in WeBuyCars’ investor presentation on 16 February, where the company outlined its strategy and stated its investment case prior to listing. 

WeBuyCars has produced incredible growth since its founding in 2001. It has grown from two employees selling a handful of cars a month to 2,800 employees selling over 13,500 cars a month. 

Most impressively, its growth has been entirely organic – not once did the company raise debt to fund its growth. Rather, it relied entirely on the profits generated by the business. 

The company’s founders, brothers Dirk and Faan van der Walt, did not draw a salary from the company to ensure as much of its profits as possible was reinvested into the business. 

Transaction Capital acquired a stake in WeBuyCars in 2020, buying up 49.9% of the company to take a non-controlling position for R1.8 billion. 

Since then, WeBuyCars has gone from one success to another, increasing its trading volume over ten times since the investment. 

However, Transaction Capital has come under immense pressure due to other parts of its business, particularly SA Taxi, struggling to recover post-Covid. 

This pushed the company into a corner, forcing it to sell off parts of its business to repay some of its debt.

As part of this, Transaction Capital announced it would unbundle its stake in WeBuyCars and list it separately on the JSE. 

The company aims to raise between R900 million and R1.25 billion from the unbundling. 

During the investor presentation, it was revealed that Transaction Capital would be left with no shares after the unbundling. 

The founders would be left with a 10% ownership stake – down from their current 25.1% shareholding. 

These changes are shown in the chart below, which outlines WeBuyCars’ shareholding structure before and after its listing. 

Source: Wide Audience Investor Presentation WeBuyCars February 2024