Sequoia investing in Auto1 at six billion euro value before IPO: sources

[FRANKFURT] Sequoia Capital agreed to invest in Auto1 Group at a valuation of about six billion euros (S$9.65 billion) ahead of the German online car-trading platform's initial public offering (IPO), people with knowledge of the matter said.

The US venture capital firm and rival fund Lone Pine Capital reached a preliminary deal to each buy about 50 million euros of Auto1 stock from early investor DN Capital, according to the people, who asked not to be identified because the information is private. They have agreed to a lock-up period of six months, the people said.

Sequoia and Lone Pine also signalled plans to invest at least 50 million euros apiece in Auto1's imminent IPO, the people said.

The move marks a vote of confidence in Auto1, which is backed by Japanese billionaire Masayoshi Son's SoftBank Group, and the business of buying and selling cars online. Auto1 said last week it aims to raise about one billion euros from a Frankfurt share sale in the first quarter.

A spokesperson for Auto1 declined to comment. An official at DN Capital didn't immediately respond to a request for comment, while representatives for Sequoia and Lone Pine couldn't immediately be reached during a US public holiday.

DN Capital became one of Auto1's first backers when it invested in the company in 2013, the year after the German startup was founded, according to its website. The venture capital firm previously invested in app developer Shazam Entertainment, which created a music-identification service later bought by Apple. It also helped fund UK online realtor Purplebricks Group and international money transfer service Remitly.

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