Carmel-based KAR Auction Services Inc. announced Wednesday morning that it has agreed to acquire a European online auto-auction company for at least $103 million.
KAR already operates more than 250 brick-and-mortar auctions in North America. The purchase of Belgium-based CarsOnTheWeb would advance its strategy of expanding internationally and positioning itself to continue to prosper as online auctions gain popularity.
“CarsOnTheWeb is a leading cross-border automotive remarketing platform in continental Europe, and their addition to our family of companies will instantly anchor KAR in the international marketplace,” KAR CEO Jim Hallett said in a written statement.
Under the deal, KAR would pay $103 million up front and could pay as much as $73 million more over time, depending on how CarsOnTheWeb performs and other factors.
COTW operates in 19 languages and has sales operations in Belgium, France, Germany, Italy, the Netherlands and Spain.
“Cross-border transactions are particularly complex for European remarketers,” Benjamin Skuy, KAR’s executive vice president for international markets and strategic initiatives, said in a written statement. “CarsOnTheWeb’s unique platform and logistics solutions directly address these challenges and have the power to deliver seamless, convenient and connected services on a global scale.”
KAR said it intends to retain COTW’s locations, employees and key executives, including CEO Johan Meyssen.
KAR is one of the largest players in the North American used-car auction business and salvage-auction business. It operates both physical and online auctions domestically and overseas, and also provides a range of ancillary services, including providing floor-plan financing to dealers.
Through those businesses, KAR in 2017 sold 5.5 million vehicles, generating $3.5 billion in revenue and profit of $362 million.
KAR has made a string of technology-related acquisitions in recent years to position itself for long-term success in the digital era.
For example, a year ago KAR announced it will spend up to $125 million to acquire a 50 percent stake in Nth Gen Software Inc.—also known as TradeRev—whose software allows auto dealers to buy and sell used cars with one another and analyze transactions.
KAR bought its initial 50 percent stake in TradeRev for $30 million in August 2014.