KAR to Spin Off Salvage Auction Subsidiary

Posted: Updated:
Jim Hallett (podium) will remain CEO of KAR Auction Services. Jim Hallett (podium) will remain CEO of KAR Auction Services.

Carmel-based KAR Auction Services Inc. (NYSE: KAR) has announced plans to spin off its salvage auction business unit, Insurance Auto Auctions. The company says the spin-off will create two independent, publicly-traded companies and is expected to be complete within the next year.

KAR says the separation of the two entities was approved by the company's board of directors and will "unlock shareholder value not currently reflected in the combined company." Once the spin-off is complete, KAR says its primary focus will be on its whole car auction marketplaces and technology solutions.

"IAA has been a meaningful part of the KAR platform for over ten years, despite limited operational overlap between IAA and KAR’s core whole car operations," said Jim Hallett, chief executive officer of KAR Auction Services. "The proposed separation will give KAR and IAA the flexibility to advance unique strategic priorities and make independent decisions on investments, acquisitions and capital expenditures. In turn, this will help both companies focus investments and innovation on serving their customers and strengthen their respective competitive positioning in the global marketplace."

After the separation is complete, Hallett will remain CEO of KAR and chairman of its board of directors. IAA will continue to be led by its current president and CEO John Kett. IAA will also retain its North American salvage vehicle operations and the HBC Vehicle Services business in the United Kingdom.

IAA's focus following the spin-off will be on the salvage vehicle marketplace serving insurance carrier sellers and a network of buyers.

"The support of KAR has allowed IAA to significantly grow our business and deliver an unmatched portfolio of products and services to our insurance customers," said Kett. "With this strong foundation and our robust pipeline of innovation, IAA is well positioned to serve our customers and expand our market presence after separation."

KAR says its shareholders will receive shares of IAA after the spin-off is complete. The deal remains subject to final approval by the KAR Board of Directors as well as market and regulatory approvals, and other closing conditions.

  • Perspectives

    • Digital Personas: Getting to a Segment of One

      Creating a digital persona means using data, machine learning and networked devices so a business can tailor messages and experiences to specific kinds of buyers and users. It sounds like a marketing unicorn, but it’s closer than you might suspect, thanks to the potential of digital personas. The ultimate goal of a digital persona is to achieve the marketer’s dream: a segment of one.



Company Name:
Confirm Email:
INside Edge
Morning Briefing
BigWigs & New Gigs
Life Sciences Indiana
Indiana Connections


  • Most Popular Stories

    • DePauw University ranked No. 20 on list of Best "Colleges"

      Small Indiana Colleges Rank High Nationally

      Indiana has two institutions of higher learning, with intentionally small enrollments, that rank in the top 30 in the nation for an overall experience.  The personal finance website, WalletHub, conducted a survey of what it calls the 2020 Best College Ranking. 

    • (photo courtesy of Indianapolis International Airport)

      Indy Airport Showcases New Retail Offerings

      Indianapolis International Airport is celebrating the opening of the first wave of new retail offerings. The new stores are part of the airport's multi-year Concessions Refresh initiative, which aims to bring a greater mix of nationally-known brands, such as FAO Schwarz and Vineyard Vines, with more local offerings, including Natalie's Candy Jar and Fountain Square Market. In all, nine new retail stores opened Tuesday morning. In an interview with Inside INdiana Business...

    • Transpo is South Bend's municipal bus system. (photo courtesy of Transpo)

      South Bend Launches Free Fare Program

      The city of South Bend has launched a new initiative to help a select number of residents who don’t have reliable and easy access to transportation get to work. The program is called Commuters Trust. 

    • Photo provided

      Stone City Products Invests $2 Million in Expansion

      Bedford-based manufacturer Stone City Products is expanding. The $2 million, 30,000-square-foot project could result in a weekend shift, adding jobs as product lines increase. 

    • The IU School of Informatics, Computing and Engineering will now be named for Fred Luddy for his $60M gift. (photo courtesy James Brosher/IU)

      $60M Gift to Fund AI Center

      An Indiana University alumnus who founded the information technology firm, ServiceNow, has given his alma mater $60 million to establish an artificial intelligence center. The university says the gift from cloud-computing pioneer Fred Luddy is the second largest in the history of the IU.