{"id":18743,"date":"2022-02-25T07:36:55","date_gmt":"2022-02-25T15:36:55","guid":{"rendered":"https:\/\/marketdepth.com\/?p=18743"},"modified":"2022-02-25T07:36:59","modified_gmt":"2022-02-25T15:36:59","slug":"carvana-to-acquire-kar-globals-adesa-u-s-physical-auction-business-for-usd-2-2-billion","status":"publish","type":"post","link":"https:\/\/marketdepth.com\/carvana-to-acquire-kar-globals-adesa-u-s-physical-auction-business-for-usd-2-2-billion\/","title":{"rendered":"Carvana to Acquire Kar Global\u2019s ADESA U.S. Physical auction Business for USD 2.2 Billion"},"content":{"rendered":"\n<p>KAR Auction Services, Inc., KAR Global (NYSE: KAR) has <a href=\"https:\/\/www.karglobal.com\/kar-global-agrees-to-2-2-billion-sale-of-adesa-us-physical-auction-business-to-carvana\/\">reached<\/a> a definitive agreement where Carvana will acquire the company\u2019s ADESA U.S. physical auction business.\u00a0 The all-cash transaction is valued at USD 2.2 Billion and includes all auction sales, operations and staff at 56 ADESA U.S. vehicle logistics centers and exclusive use of the ADESA.com marketplace within the United States.\u00a0 The agreement is in line with KAR\u2019s digital strategy and will allow KAR to focus on its portfolio of digital marketplaces.\u00a0 The transaction will be utilized to reduce KAR\u2019s corporate debt.\u00a0 \u201cKAR has always been a leader in the digital transformation of remarketing, and this transaction firmly positions us as the premier digital marketplace provider for wholesale used vehicles,\u201d said Peter Kelly, CEO of KAR Global. \u201cWhile off-premise sales have increased over the past decade and represent over 50% of our vehicle sales today, we believe we are still in the early stages of this industry evolution, and the trends are rapidly gaining momentum. Digital marketplaces provide low-cost, highly efficient venues for our sellers and buyers to transact, and our leading digital brands, platforms and technology position us well to grow as digital penetration increases. This transaction will allow us to focus our investments and energy on higher growth, higher-margin digital marketplaces and on delivering the most strategic solutions to our customers. By simplifying our business, we are better positioned to lead and win in the fastest-growing segments of this industry.\u201d<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Lowering EBITDA<\/h5>\n\n\n\n<p>\u201cThis transaction will enable a leaner, more nimble operating model and faster long-term growth rate at KAR,\u201d said Kelly. \u201cWe believe the transaction will reduce our 2022 Adjusted EBITDA by approximately $100 million on an annual basis \u2014 net of the contribution from the commercial agreement entered into with Carvana as part of this transaction. However, we will reduce our headcount by approximately 50% while also paying down the majority of our balance sheet debt. We expect these savings, when combined with our investments and our focus on higher growth platforms, will deliver higher revenue and Adjusted EBITDA growth rates, as well as higher gross profit and Adjusted EBITDA margins.\u201d&nbsp; This transaction is subject to customary closing conditions and is expected to close within the second quarter of 2022.&nbsp; The transaction has been approved by both company\u2019s board of directors.<\/p>\n","protected":false},"excerpt":{"rendered":"KAR Auction Services, Inc., KAR Global (NYSE: KAR) has reached a definitive agreement where Carvana will acquire the company\u2019s ADESA U.S. physical auction business.\u00a0 The all-cash transaction is valued at USD 2.2 Billion and includes all auction sales, operations and staff at 56 ADESA U.S. vehicle logistics centers and exclusive use of the ADESA.com marketplace&#8230; <a class=\"view-article\" href=\"https:\/\/marketdepth.com\/carvana-to-acquire-kar-globals-adesa-u-s-physical-auction-business-for-usd-2-2-billion\/\">View Article<\/a>","protected":false},"author":3,"featured_media":18744,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"pmpro_default_level":0,"footnotes":""},"categories":[10,31,17,11,16],"tags":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Carvana to Acquire Kar Global\u2019s ADESA U.S. Physical auction Business for USD 2.2 Billion - MarketDepth<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/marketdepth.com\/carvana-to-acquire-kar-globals-adesa-u-s-physical-auction-business-for-usd-2-2-billion\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Carvana to Acquire Kar Global\u2019s ADESA U.S. Physical auction Business for USD 2.2 Billion - MarketDepth\" \/>\n<meta property=\"og:description\" content=\"KAR Auction Services, Inc., KAR Global (NYSE: KAR) has reached a definitive agreement where Carvana will acquire the company\u2019s ADESA U.S. physical auction business.\u00a0 The all-cash transaction is valued at USD 2.2 Billion and includes all auction sales, operations and staff at 56 ADESA U.S. vehicle logistics centers and exclusive use of the ADESA.com marketplace... 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