Carvana acquires ADESA for $2.2 billion
Online used car marketplace Carvana is acquiring physical auction business ADESA from KAR Global for $2.2 billion in cash.
Founded in 2012, Carvana allows users to shop, finance, and insure their cars. ADESA, on the other hand, is the second largest provider of wholesale vehicle auction solutions in the US – last year, its business facilitated over one million transactions.
According to Carvana, ADESA’s 56 sites are highly complementary, and combining them extends the collective reach of the two businesses. Further, 78% of the US population lives within 100 miles of either an ADESA or existing Carvana inspection and reconditioning center, meaning customers will have access to more vehicles with faster delivery times than ever before.
Carvana will continue to operate ADESA’s existing wholesale auction business and related services under the ADESA brand. ADESA US President John Hammer additional senior and executive leadership and teams will transition to Carvana after the deal is closed.
ADESA generated over $800 million of revenue and over $100 million of EBITDA in 2021. Carvana, on the other hand, sold its one-millionth car last year and had its first profitable quarter in the fourth quarter of 2021.