Auto Trader has swooped for Autorama in a deal which could be worth up to £200 million.
The London-listed group, the UK’s largest automotive marketplace, has agreed to acquire the share capital of limited company Autorama (UK), one of the UK’s largest transactional marketplaces for leasing new vehicles.
Autorama has created an end-to-end digital platform which aggregates leasing deals from multiple funders and OEMs – behind its Vanarama brand – enabling buyers to transact online across a wide range of vehicles.
Auto Trader will pay an initial consideration of £150m in cash, with a further £50m of deferred consideration to be settled in shares subject to customary performance conditions 12 months after the completion date.
At 31st December 2021, Autorama had £27m of gross assets and for the calendar year 2021, made net revenue of £26m, selling around 14,500 vehicles and had an EBITDA loss of £6m, which included marketing costs of over £9m.
Auto Trader says the acquisition will transform its existing leasing proposition and help to meet the demands of the growing number of consumers who might consider leasing their next new vehicle.
It will also enable Autorama to leverage Auto Trader’s brand to accelerate its recent expansion, beyond light commercial vehicles, into leasing new cars.
“To ensure we have the largest choice of cars to buy online, we could not ignore the growing demand for leasing deals,” said Auto Trader CEO Nathan Coe.
“In Vanarama, we have found an industry leading leasing platform that delivers a great consumer experience and significant sales for its partners.
“This acquisition will strengthen our leasing business and will enable us to offer both the biggest choice of vehicles and a seamless digital experience from search to sale. I am delighted to be welcoming [CEO] Andy [Alderson] and his team to the group.”
Alderson added: “As the leading aggregator of leasing deals online, we have sold over 120,000 vehicles for our manufacturer, retailer and lease company partners.
“Over the last few years we have invested significantly in our technical capability to help our partners respond to the high levels of consumer demand for a digital buying experience.
“We are hugely excited about the prospect of being able to accelerate our growth plans and deliver even more value to our partners as part of the Auto Trader Group.”