Airtasker buys Oneflare for $9.8 million – a quarter of its former valuation

ASX-listed gig economy marketplace Airtasker is acquiring services platform Oneflare for $9.8 million.

The company (ASX:ART) will help pay for the acquisition by raising $6.25 million via an underwritten placement of approximately 14.5 million new fully paid ordinary shares at $0.43 cents. Airtasker shares have been placed in a trading halt at $0.51 cents.

Oneflare is Australia’s 3rd largest local services platform, serving more than 540,000 customers and 14,500 verified businesses annually. It has a strong presence in trades, home improvement and professional services. Airtasker said the acquisition will accelerate its strategic expansion into the high value service categories Oneflare focused on. The average task price on Oneflare is $2,300+.

The deal looks like a bargain for Airtasker after online real estate site Domain (then part of Fairfax) bought into the startup in 2016, paying $15 million for a 35% stake that valued the business at $43 million.

Airtasker is paying for the acquisition with $2.25 million in cash, plus $7.55 million in its shares, at $0.43 cents, with 50% escrowed for 12 months, and the other half escrowed for 24 months. The deal represents 1.6x of FY23 revenue of greater than $6 million.

Airtasker co-founder and CEO, Tim Fung, said the merger strengthens network effects for both companies.

“I’m super stoked to bring together Airtasker and Oneflare to create Australia’s no. 1 marketplace for local services. Together, we can offer our customers access to an even greater range of local services and faster response times whilst creating more job opportunities than ever before,” he said.

“By acquiring Oneflare, we also accelerate a push into higher value service categories including trades, home improvement and professional services to deliver on our mission: to empower people to realise the full value of their skills.” 

The Shares to be issued under the Placement represent around 3.5% of Airtasker’s pre-offer issued share capital, and the total Shares to be issued under the Placement and Acquisition represent 7.7% of Airtasker’s pre-offer issued share capital.

Company directors James Spenceley, Peter Hammond and Xioafan (Fred) Bai, or their associates, who are existing shareholders, will subscribe for $3.55 million in the Placement, subject to shareholder approval at a meeting in late June, with a Share Purchase Plan (SPP) raising up to $1.2 million, with a maximum entitlement of up to $10,000. If fully subscribed, the SPP represents approximately 0.7% of Airtasker’s pre-offer issued share capital. 

The Placement is fully underwritten by Morgans Corporate Ltd. 

Oneflare launched as an online marketplace in 2011, acquiring several other companies, including Urban You and Word of Mouth Online, in subsequent years.

It raised $3 million in mid 2015 amid talk of plans to IPO the following year. In 2016, Domain paid $15 million for a 35% stake.

While the acquisition looks like good value for Airtasker, paying less than a quarter of Oneflare’s 2016 valuation, the ASX-listed company has seen its share price fall around 59% over the past 12 months.