European Purchase Positions KAR to Boost Auction Tech | Auto Finance News | Auto Finance News

European Purchase Positions KAR to Boost Auction Tech

Via Car Auction Mall

KAR Auction Services’ plan to acquire Belgium-based counterpart CarsOnTheWeb (COTW) will position the U.S. company to compete in the international remarketing arena.

It is also likely to spark technology enhancements for the combined entity, said Robert W. Baird & Co. analyst Craig Kennison. The $103 million deal — slated to close in the first quarter of 2019 — should have minimal impact on North American used-car prices, he added.

Rather, “it should only provide more resources to enhance the experience in North America,” he said. Currently, KAR operates in the U.S., Canada, Mexico, and the U.K. The acquisition will expand KAR’s footprint to include Belgium, France, Germany, Italy, the Netherlands, and Spain.

“More cars equal more revenue — and more revenue equals more resources to invest in the next generation of remarketing tools,” Kennison told AFN in an email. The deal will also provide the Carmel, Ind.-based auction firm with a cross-border automotive remarketing platform that will “instantly anchor KAR in the international marketplace,” KAR Chief Executive Jim Hallett said in a press release.

Specifically, COTW’s VAT-compliant payment, document transfer, and post-sales processes will give KAR a strong foothold to compete in Europe, said KAR spokeswoman Gene Rodriguez. “The biggest challenges for European cosigners are cross-border transactions and logistics,” she said.

KAR has steadily been building its digital capabilities. Last month, it acquired Reno, Nev.-based Clearplan, a digital platform for repossession workflow and logistics management. In April 2017, it bought CarCo Technologies Inc., an aggregator of automotive retail, pricing, registration, and economic data, for $43 million.

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