AutoCanada said Tuesday it has spread to western Manitoba, purchasing Kelleher Ford in Brandon.
The store, which also includes a collision center, is western Manitoba’s largest Ford dealership.
Current management will remain.
“This high-quality operation is our second Ford dealership and initiates our presence in western Manitoba — an attractive truck market, while providing the opportunity to further expand our presence in the market,” AutoCanada executive chairman Paul Antony said in a news release.
“We are pleased to welcome the team from Kelleher Ford, and we look forward to many opportunities for continued growth as we integrate them into our strong portfolio of dealerships,” Antony said.
In addition to reporting quarterly results this week, AutoCanada also announced the acquisition of two dealerships that expand its Ontario presence and adds the Porsche brand to its franchise portfolio.
The retailer said Monday it has purchased Porsche of London and Audi Windsor, two stores that generate more than $80 million in annual revenues.
“We’re excited about the addition of these high-quality Audi and Porsche dealerships, further expanding our platform in Ontario while adding brand diversity and increasing the mix of luxury dealerships within our overall portfolio," AutoCanada executive chairman Paul Antony said in a news release.
“Notably, the acquisition expands our relationship with Audi and brings Porsche into our Canadian dealership portfolio,” Antony said. “The acquisition of these dealerships advances our continued strategy of diversifying our brand and geographic mix and will provide tremendous growth opportunities as we integrate them with our strong portfolio of dealerships.”
Reporting earnings on Wednesday, AutoCanada said it generated $1.34 billion in revenue in the first quarter. That was the highest-ever Q1 revenue total for the retailer and a 38.4% year-over-year increase.
AutoCanada reported $4.3 in net income, down from $21.3 million a year ago.
Its adjusted EBITDA was $62.2 million, up from $47.2 million.
In the earnings release, Antony said: “We opened 2022 with yet another record first quarter, reflecting ongoing positive momentum and our business as a whole continues to perform better than ever.
“Our Q1 results speak to the determination, agility and strength of our team, and the trend of sustainable improvement across all areas of our business. Continued strong performance from used vehicles, F&I, and our U.S. operations were key drivers in the quarter,” he said.
“We continued to advance our acquisition strategy with the recent addition of the Audi Windsor and Porsche of London dealerships, further expanding our platform in Ontario while adding brand diversity and increasing the mix of luxury dealerships within our overall portfolio,” Antony continued.
“Looking forward to the remainder of 2022, with our newly expanded executive team in place, we will continue to build on our strong momentum and focus on our strategic growth pillars to deliver industry-leading performance and enhance shareholder returns. We remain well positioned to continue to execute on our acquisition strategy in the coming quarters with several dealerships currently being evaluated. We also expect to see continued realization of synergies from our acquisitions which will further drive our 2022 Adjusted EBITDA performance.”
On the executive front, AutoCanada said that Maryann Keller was retiring from its board of directors Thursday. The company also reiterated three executive moves it made in April: naming Jeffery Thorpe as president of Canada operations; Brian Feldman as senior vice president of Canadian operations and disruptive technologies; and Lee Wittick as senior vice president of operations and OEM relations.
U.S.-based auto retailer Lithia & Driveway, which expanded into Canada last year with the purchase of Toronto’s Pfaff Automotive Partners, has increased its Canadian footprint with a purchase announced Tuesday.
In the first addition to its Canadian portfolio since buying Pfaff, Lithia has acquired Thornhill, Ontario-based Sisley Honda.
The store, which opened in 1946 and is a multi-generational family business, is expected to bump Lithia’s total expected annualized revenue acquired this year above $1.2 billion.
Lithia financed the purchase via existing on-balance sheet capacity.
“We are excited to welcome the Sisley Honda team to our Lithia & Driveway family,” Lithia president and chief executive officer Bryan DeBoer said in a news release.
“With this addition we are able to expand our omni-channel network in Canada, strengthening our position in one of the top Canadian markets,” DeBoer said.
Just before 2021 closed, the Automotive Properties Real Estate Investment Trust said it had signed a $23.4 million deal with a dealership group to buy the Sherbrooke Honda and Magog Honda properties in Quebec.
Additionally, the REIT exercised its Right of First Refusal and signed a deal to buy roughly 2.15 acres of land in Langley, British Columbia (located at 20257 Langley Bypass) from a third party, which it said is “subject to a land lease paid by the operator of the Acura Langley dealership, an affiliate of the Dilawri Group, and an existing tenant of the REIT.”
The maturity date on the land lease is June 30 and the price for the land was about $15.1 million.
“The acquisition of the Sherbrooke Honda and Magog Honda properties will increase our footprint in Quebec and expand our relationships with leading dealership groups,” Milton Lamb, who is president and chief executive officer of the REIT, said in a news release.
“The transaction involving Acura Langley enables us to consolidate ownership of the land and building and the related leases, thereby further enhancing the value of our property portfolio in the Greater Vancouver Area.”
Both deals are expected to close this month.
EBlock continues to grow, and this time, it has made a move in Canada.
The company announced Wednesday it has acquired digital dealer-to-dealer auction marketplace TradeHelper and parent company ESP Auctions. The latter is a Montreal-based independent auction.
ESP owner Alain Boisvert partnered with former ADESA chief executive Stephane St-Hilaire to purchase TradeHelper in December 2019. Founder Karl Tremblay heads up TradeHelper.
Both ESP and TradeHelper will continue operations as-is.
“This move allows EBlock to expand and strengthen our position in our fastest growing market of Quebec, a vital region of Canada,” said Jason McClenahan, who is president, and CEO of E INC, EBlock’s parent company.
“By bringing on more than 100 experienced bilingual team members we can better service our customers in their language of choice,” McClenahan said. “And, by adding 24,000 wholesale transactions and thousands of marketplace participants we will not only strengthen our position in Quebec but we will have a major impact for all our dealers in eastern Canada.”
St-Hilaire, the former ADESA CEO who is co-owner of ESP and TraderHelper, added: “Our customers will benefit from the most robust network of buyers and sellers in the industry and an expansion of products and services that only a combination of physical space and state-of-the-art technology can offer.
“EBlock has the right people, technology, and strategy to boost the tremendous growth the vehicle remarketing industry is going through today. We are excited to be part of it,” he said.
EBlock also operates in the U.S., where it helps facilitate dealer-to-dealer auction sales for independent auctions.
AutoCanada has purchased Ontario independent dealer Mark Wilson’s Better Used Cars, a move the retailer says augments its plans of building its Used Digital Retail Division.
This is the second independent dealer AutoCanada has purchased.
In a similar move, the group bought Haldimand Motors, also an Ontario independent dealer, in December as part of its Used Digital Retail Division
As for Tuesday’s purchase news, the Guelph-based Wilson’s includes facilities spanning 43,000 square feet over 16 acres. The store has 24 shop bays and a full service department.
The dealership will continue to be operated by Mark Wilson.
“The addition of Mark Wilson’s expansive used-vehicle operations further expands on our Used Digital Retail Initiative — a strategy to address the substantial opportunity in the Canadian market with the dedicated sale of used vehicles across all channels, including completely online … As one of the best used- vehicle dealer operators in the country, adding Wilson’s to AutoCanada further improves the company’s bench strength and talent pool and allows us to assess best in class practices as we continue to build our Used Digital Retail platform,” AutoCanada executive chairman Paul Antony said in a news release.
“This acquisition also aligns with our strategy of geographic diversification as it expands our network of used dealerships and furthers our exposure into the Ontario market,” Antony said.
“We continue to see the Used Digital Retail opportunity providing us not only with a Canadian first mover advantage in the category and a wealth of domain expertise, but the ability to build a Used Digital Retail operation with attractive unit economics that should allow us to scale rapidly without meaningful cash burn — a notable difference from some of the U.S. digital retail players,” he said.
“Our Used Digital Retail Initiative sets the foundation to serve all customers for all transaction types as mobility ownership and transportation evolves, and we expect this initiative to be a key driver for the future of AutoCanada leadership.”
The opening days of 2020 have been eventful for iA Financial Corp. Inc., the holding company of iA Financial Group.
The company announced on Friday that it acquired three companies specializing in vehicle warranties in Canada: WGI Service Plan Division and WGI Manufacturing, two subsidiaries of C. Walker Group, located in Vancouver and Scarborough, Toronto, as well as Lubrico Warranty, based in London, Ontario.
Officials said these acquisitions are effective immediately. The company added these acquisitions will be financed from cash on hand and reduce its solvency ratio by 2 percentage points.
The company highlighted C. Walker Group is a market leader and longtime partner of iA Financial Group in the Canadian warranty and ancillary products business. The primary business is wholesale manufacturer and administrator of chemical protection products for the automobile industry through more than 950 independent dealers across Canada.
Officials stressed that WGI Service Plan Division and WGI Manufacturing are well known in the industry for their two brands: Diamond Kote and W3 Solutions. These companies have about 70 employees mainly located in Vancouver and Scarborough.
As for Lubrico Warranty, iA Financial recapped that Lubrico sells vehicle warranties through over 4,000 independent dealerships across Canada (except in the province of Quebec). The warranties also are honored at more than 3,000 authorized repair facilities.
Lubrico has 35 employees, excluding sales distributors.
Officials said the activities of these companies will be managed under the leadership of the dealer services division of iA Financial Group.
“These acquisitions demonstrate how dynamic and important iA Financial Group is in the vehicle warranties industry. We continue to build on our strong foundation in Canada,” said Sean O’Brien, senior vice president of dealer services at iA Financial Group. “With these acquisitions, iA pursues its growth strategy to become a major force in the Canadian automobile ecosystem by achieving scale and industry leading productivity.
“These acquisitions offer substantial opportunities in respect of client and dealer experience and will make iA more present in used vehicle dealerships. We are pleased to welcome the highly professional teams of WGI and Lubrico Warranty,” O’Brien continued.
Chuck Walker, owner of C. Walker Group, shared his perspective on the acquisition.
“We are excited that WGI will be joining a visionary and forward-thinking organization,” Walker said. “iA has demonstrated its commitment to enhancing its car dealer and client experience.
“We are confident that our clients and dealers will be well served and their interests will continue to be well represented,” Walker went on to say.
Lubrico Warranty president Terry Fletcher added, “With Lubrico Warranty becoming part of iA’s dealer services division, we anticipate that synergies will allow us to add significant value to the services offered to Canadian consumers looking to acquire a vehicle through our network of dealer partners.”
A new board member, a new high-level executive, a new remarketing network in the U.S., and now the acquisition of a finance company that specializes in vehicle leasing.
Thus far, 2019 has been quite an active year for PowerBand Solutions.
Earlier this week, the online auction and remarketing platform announced the purchase agreement for an acquisition first mentioned by the company back in January. PowerBand’s agreement states the company will acquire 60% of MUSA Holdings and its subsidiaries, including MUSA Auto Finance. According to a news release from the company, PowerBand is giving $300,000 in cash and 4.3 million shares of company stock.
PowerBand said the acquisition will transform it into an “industry leading” fintech company in the areas of vehicle acquisition, leasing, lending and auction services. PowerBand acknowledged the acquisition is subject to the approval of the TSX Venture Exchange.
“This is a transformative acquisition for PowerBand. By combining MUSA’s industry-leading leasing platform with PowerBand’s comprehensive used vehicle online remarketing auction platform, we have differentiated PowerBand in the automotive industry and will be able to offer dealers, commercial, rental and leasing companies and consumers a one-stop online platform to buy, sell, trade and finance vehicles,” PowerBand chief executive officer Kelly Jennings said.
“We are excited to work with MUSA’s management team to accelerate MUSA’s ability to originate new leases in 2019 and beyond,” Jennings continued. “We will work closely with MUSA and our partners to raise new capital and warehouse facilities. We have started conversations with automotive partners like RouteOne to accelerate MUSA and PowerBand’s growth in the United States.”
The acquisition announcement arrived after PowerBand announced back in April the launch of D2D Auto Auctions, a remarketing network in the U.S. The company also appointed Ivan Buzbuzian to its board of directors in July and hired Sam Rizek as vice president of business development earlier this summer.
PowerBand’s plans for MUSA
Founded in 2016, Dallas-based MUSA leveraged its innovative technology platform designed to modernize the new and pre-owned vehicle leasing experience to be awarded a contract by Tesla Motors to become the electric vehicle automaker’s national leasing partner in 2018.
During the testing phase with Tesla that was restricted to California, PowerBand recapped that MUSA developed technology that takes an application, calculates a lease, auto-decisions the application, provides an approval back to dealer partners, and prefills a lease contract accurately in less than eight seconds. PowerBand recapped that Tesla was so impressed with the ease of the platform that the company sent $50 million in Tesla leasing contracts to MUSA over a weekend and a total of $90 million during the test phase.
In order to accommodate the Tesla lease program, officials recounted that MUSA filled a 157.5 million financing facility to capacity in 2018 with an average FICO score of 739. MUSA’s product demand with Tesla and dealer partners in 33 states prompted Robert McDonald, a former Goldman Sachs vice president to describe MUSA as “one of the fastest-growing auto finance companies ever.”
MUSA subsequently sold the financing facility this past May in a private placement to Crestline Investors, according to the news release.
PowerBand explained its acquisition of MUSA brings together two companies with the vision to become a one-stop SaaS platform for the entire vehicle purchase lifecycle. Franchised dealers, independent dealers, and consumers will be able to:
— Use MUSA’s real-time lease origination platform to lease new and used vehicles
— Acquire pre-owned vehicles for MUSA consumers through PowerBand’s online auction platform
— Retain customers through new lease options using the PowerBand-RouteOne partnership
— Resell off-lease vehicles to D2D Automotive Auctions through the PowerBand auction platform. D2D is a joint venture partnership owned equally by PowerBand and Bryan Hunt in the U.S.
In addition to expanding its lease origination portfolio, PowerBand and MUSA have plans to pursue:
— Direct-to-consumer lending platform
— Online consumer-to-consumer marketplace geared to connect individual sellers with buyers who will use MUSA for lease financing
— Aggressive expansion toward nationwide operations by adding at least 15 states, bringing the MUSA’s total number of states to 48.
“The executive team at MUSA is excited to join together with PowerBand, D2D Automotive Auctions and its other strategic partners,” MUSA chief executive officer Jeff Morgan said.
“While we specialize in new and used auto lease finance, we are continuing to enhance our technology to achieve simplicity in an otherwise complicated process,” Morgan continued. “We quickly achieved Elon Musk’s vision of being able to complete a transaction on the dashboard of a Tesla at delivery, and we are really excited about a new technology currently under development that we hope to announce later this year.”
Powerband launches D2D Auto Auctions in the US
As previously mentioned, PowerBand officially launched D2D Auto Auctions back in April.
D2D Auto Auctions is the realization of the previously announced partnership PowerBand and Bryan Hunt entered into in November of last year to establish an automotive online remarketing network in the United States. Since that time, PowerBand has been customizing its auction platform for the U.S market while Bryan Hunt and his team at 71B Auctions in Springdale, Ark., have been marketing the D2D remarketing solution to its vast base of existing dealers who currently buy and sell vehicles at their physical auction locations.
As of the launch time, PowerBand indicated more than 1,300 dealers had been registered on the D2D platform and this number was expected to increase as D2D’s sales team targets additional dealerships and commercial customers, including leasing, rental and fleet companies, across the Southern United States.
D2D customers are able to access the online auction platform on their computers at www.D2DAA.com, or on their mobile devices by downloading the D2D App, that is available on either iOS or Android.
“In partnership with Bryan Hunt, we are excited to have launched D2D Auto Auctions’ online platform,” PowerBand president and chief operating officer Mike Moen said. “D2D’s customers will be able to save considerable time and money buying and selling vehicles online versus the traditional physical auction method. D2D’s customers will also have access to a greater supply and variety of used vehicles, including vehicles exported from Canada, than they would through physical auction channels.
“In the U.S. alone over 40 million used vehicles exchange hands each year, with over 10 million vehicles being bought and sold through auctions,” Moen continued. “Online auctions are growing at a faster rate than physical auctions and we believe D2D has a large opportunity to capture considerable market share in a fast-growing market segment of the used vehicle industry, giving PowerBand a solid foothold in the U.S. automotive transaction marketplace.”
New PowerBand board member
Soon after Canada Day, PowerBand appointed Ivan Buzbuzian to its board of directors.
The company highlighted Buzbuzian brings an extensive background in the areas of capital markets, project development, operations, and management. Originally, Buzbuzian was involved in the management and operations of his family business, a nonferrous jobbing foundry, which had more than 60 years of success in both the Canadian and U.S. markets. Buzbuzian has participated financially and actively in other business ventures both in the private and public sectors, expanding from manufacturing to service sectors and commerce, project financing, marketing, real estate, healthcare and natural resources.
Buzbuzian also possesses experience as a registered broker with the Ontario Securities Commission.
“We are very pleased that Ivan has accepted our offer to join the board of PowerBand,” Moen said. “Ivan has a deep knowledge of the investment industry and a broad global network of automotive, software and investment industry executive contacts which will advance PowerBand’s growth in the future. We are looking forward to working with Ivan to expand PowerBand’s global reach.”
New VP of business development
Furthermore, PowerBand tapped an executive who has held roles with Toyota Canada and DealerSocket to be its vice president of business development.
Sam Rizek joined PowerBand in June with more than 25 years of executive experience in the North American automotive industry.
After graduating from Ryerson University, Rizek worked for Toyota Canada in logistics and vehicle distribution and later as area sales manager in its Pacific Zone in B.C. He then spent three years as regional manager in the U.S. Pacific Northwest for HigherGear Group CRM software.
In 2009, Rizek was appointed national sales manager for DealerSocket. He subsequently assumed the role of national director of sales and business development for the CRM provider and grew the Canadian team to more than 20 employees and a 25% market share. Also, while at DealerSocket, Rizek worked at the top corporate level with some of the largest dealer groups in Canada and the United States, including leading dealer groups in California.
“We are very pleased to have someone of Sam’s experience and level of success join the PowerBand team,” Moen said. “Sam will be utilizing his vast network of industry contacts to expand the use of PowerBand’s used vehicle remarketing platform among larger dealership groups, commercial, leasing and rental companies, with a particular focus on the U.S. market.”
Rizek added, “I am looking very forward to introducing PowerBand’s comprehensive used vehicle remarketing services to the thousands of dealers and corporate clients that I have dealt with over the years.
“I believe PowerBand is positioned to become an industry leader in the remarketing, export and vehicle financing sectors of the automotive industry,” he went on to say.
Dealership website and tech company Leadbox has merged with Drive Media, a dealership advertising and tech company.
The merger, announced Feb. 14, brings together two companies that have been collaborating for more than two years, including a recent collaboration to serve as a certified marketing services vendor for Canadian Ford dealerships.
“Working together in this way, it became clear that a more formal and long-term relationship made perfect sense,” Drive Media co-founder Rob Barber said in a news release.
Leadbox said in the release that Drive Media’s proprietary ad technology offers a “complementary extension” to the website and dealer marketing software that Leadbox provides.
“Leadbox has been producing outstanding dealership websites and technology for top dealers in the Canadian marketplace for the last seven years,” said Ian Cruickshank, Leadbox president and chief executive officer, said in a news release.
“More recently, the teams have found an increased synergy from working with Drive Media. The merger of these two great companies enables us to deliver a better aligned and higher quality experience for today's dealerships,” Cruickshank said. “With simplicity as one of our primary focus areas for our dealer partners, it no longer made sense to perpetuate the distraction of two separate brands.”
Barber, of Drive Media, added: “I’m proud of what Drive Media has built in the last few years, but we are not even close to reaching our potential.
“Merging with Leadbox is an exciting change for our dealer partners as it will allow them to get more out of both organizations. For example, better integrations to track and manage attribution and a clear line from inventory management to dynamic inventory marketing in search, display and even in video.”
The merger means Leadbox has Canadian offices in Vancouver, Toronto and Ottawa, plus its Venezuelan development and technology office.
After seeing the improvement of its first two 2018 dealership acquisitions in Western Canada, Foundation Automotive Group in Calgary is looking for rapid U.S. growth in 2019, with seven U.S. dealership acquisitions planned for the first quarter and nine planned after that for the second quarter.
Foundation Automotive Corp., which describes itself as one of Canada’s newest and fastest-growing automotive groups, acquired Foundation Squamish Chrysler Dodge Jeep Ram in Squamish, B.C., in October. In November, the group acquired Foundation Drayton Valley Chrysler Dodge Jeep Ram in Drayton Valley, Alberta.
“When we acquired these stores, back in October and November of 2018, they were not broken stores. They were good stores with room for improvement. And we like that,” Chuck Kramer, chief operating officer of Foundation Auto, said in a news release. “What we're doing is coming in and re-working some of the key processes, creating efficiencies and providing much-needed support. Our early efforts are already showing rewards.”
Foundation Auto boasts of its “all-star executive management team with the perfect mix of operations specialists and analytical professionals.” The company says the team’s vision is to be “the North American benchmark for top-tier automotive solutions.”
That group will work on continuing to improve operations at its most recently acquired dealerships. Travis Van Spronsen (dealer principal/managing partner) will manage Foundation Drayton Valley Chrysler Dodge Jeep Ram, and his operational experience includes work with Browns’ Chevrolet Buick GMC in Dawson Creek, British Columbia. At that dealership, Van Spronsen “built a deep-rooted culture of service,” Foundation Automotive Group noted in a news release.
Adam Mounzer (dealer principal/managing partner) will manage Foundation Squamish Chrysler Dodge Jeep Ram, and he brings more than 25 years of industry experience. That experience includes more than five years in management roles at Dodge dealerships across Western Canada.
