KAR Auction Unit Buys Stake in Canadian CompanyPosted: Updated:
A business unit of Carmel-based KAR Auction Services Inc. (NYSE: KAR) has acquired a 50 percent stake in an online vehicle auction company in Toronto. The deal with Nth Gen Software Inc. is valued at $30 million.
August 6, 2014
Carmel, Ind. -- Carmel, Ind.-based KAR Auction Services, Inc. (NYSE: KAR), a provider of used vehicle auction services, announced today that its business unit ADESA has acquired a 50 percent stake in Toronto-based Nth Gen Software Inc. ("TradeRev") and its online vehicle remarketing system, TradeRev. The total purchase price for the transaction is approximately $30 million in cash. ADESA also announced that it has entered into a joint marketing agreement with TradeRev to assist in expanding its footprint in the dealer-to-dealer online space in the U.S. and Canadian markets. ADESA will be the exclusive provider of certain products and services to TradeRev's customers. ADESA will also leverage its 65 auction locations across North America and the company's strong online auction presence and dealer network to support TradeRev's diverse dealer offerings.
TradeRev is an online automotive remarketing system where dealers can launch and participate in real-time vehicle auctions at any time from their mobile devices or desktop.
"TradeRev allows dealers to obtain instant bids while the retail customer is sitting in the showroom by providing a private, customized network for buyers and sellers that quickly and efficiently moves fresh trades," said ADESA President and CEO St?phane St-Hilaire. "We acknowledge that dealers are using technology more and more to buy and sell cars," said St-Hilaire. "In that regard, TradeRev is a natural evolution in the dealer-to-dealer space which includes approximately 20-22 million transactions a year."
Mark Endras, the president, founder and creator of TradeRev, and the company's management team own the other 50 percent interest in TradeRev.
"We have long admired ADESA's ability to deliver simple, consistent solutions in the used-vehicle market and the company's capability to provide a broad network of users across Canada and the United States," said Endras. "TradeRev has always believed in providing dealers and wholesalers cutting-edge technology to enable them to create new efficiencies within their operations. Partnering with ADESA will allow us to share our innovative TradeRev technology with even more customers across North America."
Registered dealers list cars in a TradeRev auction, and participating buyers get an instant notification of new vehicles as they are posted. This system also has a variety of sales tools, as well as immediate analytics for accurate vehicle appraisals. Founded in 2009, TradeRev currently operates throughout Canada and in some U.S. states.
Source: KAR Auction Services Inc.