Canadian Lender Scouts New Acquisition Targets

Following its acquisition of Cars on Credit, subprime Canadian lender Axis Auto Finance plans to expand across the country in the next 18 months, Founder and Chief Executive Ilja Troitschanski told Auto Finance News.

“We see ourselves as the consolidator in this space in Canada,” Troitschanski said.

The acquisition of nonprime lender Cars on Credit was finalized earlier this month and expands Axis Auto’s geographic territories to include the Maritime province and a stronger foothold in Ontario. While both companies are Ontario-based, their dealer overlap is only 7%, Troitschanski said.

Axis Auto’s portfolio more than doubled to $44.8 million after combining with Cars on Credit’s $25.6 million in receivables.

“We look for an underwriting team that really shares our philosophy, which is credit thirst,” he said, meaning the team will seek out good credit qualities and not just originate for volume. “We looked at Cars on Credit and did a very detailed credit due diligence on their portfolio, and we ultimately really liked what we saw.”

Cars on Credit originated $16 million of loans and leases in 2017, compared with Axis Auto’s $15.2 million in originations, according to an investor presentation. “For us, the focus has been on growth, both organically and through acquisition,” Troitschanski said. “If I had to guess, I would tell you that there are more acquisitions to come.”

For more content like this, attend the third annual Auto Finance Innovation event, slated for March 7-8, at the Parc 55 in San Francisco. For information, or to register, visit autofinanceinnovation.com.