KAR Auction Services, Inc. announced the successful completion of its sale of the ADESA U.S. physical auction business to Carvana on May 10. The sale, originally announced in February, includes all ADESA U.S. physical auction sites, operations, and staff at 56 ADESA U.S. vehicle logistics centers and exclusive use of the ADESA.com marketplace in the U.S. According to the announcement, the completed transaction advances KAR’s digital strategy, enhances the company’s financial profile and better positions the company and its digital marketplaces for growth.
“We believe the future is digital, and the channel shift toward digital across our industry is gaining momentum. KAR is now better positioned than ever to lead this evolution and capture the broad opportunities ahead,” said Peter Kelly, CEO of KAR Global. “Our new, more simplified business model allows us to focus our strategy, energy, and investments on developing and deploying the digital solutions our customers want, need, and value the most. We believe expanding our capabilities and the portfolio of services we provide will generate the greatest benefits for those customers, increase our market share and, ultimately, deliver the greatest value to our shareholders.”
KAR will continue to operate its Openlane platform that supports more than 40 private label programs and represents approximately 80% of North America’s off-lease inventory. KAR will also continue operating its digital dealer-to-dealer businesses, BacklotCars and CARWAVE in the U.S. and TradeRev in Canada. In addition, the company will retain its ADESA Canada, ADESA U.K. and ADESA Europe businesses as well as its affiliated inspections, transportation, and other services brands, including floorplan solutions provider AFC.
According to the company, additional details on its strategy and projections will be covered in KAR’s analyst day update call, planned to take place in June.