KAR to acquire CARWAVE dealer-to-dealer platform for $450M
KAR Global has made yet another big move in the online dealer-to-dealer space.
The company said Monday it has reached a deal to acquire CARWAVE Holdings for $450 million.
The California-based dealer-to-dealer online wholesale marketplace was founded in 2009, and its network of dealer customers includes stores in Arizona, California, Nevada, Oregon and Texas.
The platform allows dealers to take trade-ins and aged frontline inventory and quickly wholesale them, while also sourcing vehicles to purchase.
Co-founders John Lauer and Bill Lauer will stay on with the company, which will continue operating its Escondido, Calif., headquarters.. The purchase is expected to close by the end of the year.
“This acquisition will advance our clear growth strategy in the dealer-to-dealer segment and accelerate the positive momentum we’ve sustained over the past several quarters,” KAR Global chief executive officer Peter Kelly said in a news release. “CARWAVE has a strong, active dealer network in California — the country’s largest wholesale automotive market, as well as a growing presence in Arizona and Texas.
“The acquisition will enhance our continued growth in all of these areas while providing each company’s unique customers with greater choice through an expanded buyer and seller base,” Kelly said. “CARWAVE’s asset-light, technology-forward business model, with approximately 100,000 vehicles sold over the past 12 months, will enable us to continue driving innovation, achieve immediate profitability across our dealer-to-dealer offerings and enhance our position in the highly competitive dealer-to-dealer space.”
CARWAVE president John Lauer said: “We started CARWAVE to provide dealers with a low cost, low stress and hassle-free alternative to physical wholesale auctions. KAR has truly embraced these core principles, and their progressive approach continues to lead the digital transformation of our industry.
“Our two organizations share a passion for innovation, a dedication to customer service and a commitment to making wholesale easy. And we look forward to combining our great networks of trusted dealers and delivering the best, most convenient and profitable wholesale solutions possible.”