Online vehicle auctioneer Copart on Thursday agreed to acquire ACV Auctions in an all-cash deal of about $1.9 billion (€1.6 billion), marking its entry into dealer-to-dealer wholesale remarketing.
The acquisition comes as Copart seeks to expand beyond its core auction business amid slowing vehicle volume growth, hurt by insurers retaining more vehicles and consumers cutting back on auto insurance amid inflationary pressures.
Shares of ACV Auctions jumped over 40 per cent after the closing bell. It is headed up by United States tech entrepreneur George Chamoun. ACV owns online Irish car auctioneer TradeBid.
New York-based ACV operates a digital marketplace for wholesale vehicle transactions, connecting dealers, commercial buyers and sellers of used vehicles.
The purchase price of $10.50 per share represents a premium of about 45 per cent to ACV’s last close, Copart said.
Evercore is serving as financial adviser to Copart and JP Morgan Securities is to ACV for the transaction, which is expected to close by the end of this year.
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Last month, Bloomberg News reported that Copart was in talks to acquire car-insurance software provider CCC Intelligent Solutions, which has been exploring a sale.
Copart on Thursday also posted fourth-quarter revenue above Wall Street estimates, sending the company’s shares up 8 per cent in aftermarket trading.
Revenue rose 2.4 per cent to $1.15 billion from a year ago, compared with estimates of $1.14 billion, according to data compiled by LSEG.
Quarterly profit, however, declined to 35 cents per share from 41 cents a year ago. – Reuters
