Ritchie Bros to acquire online vehicle marketplace IAA for $7.3bn

Ritchie Bros. Auctioneers, a Canadian auction company, has agreed to acquire IAA, a US-based digital marketplace for vehicle buyers and sellers, in a stock and cash transaction valued at around $7.3 billion, including $1 billion of net debt.

The acquisition is expected to help Ritchie Bros expand into the vehicle remarketing segment and fast-track its growth and strategic vision to form a global marketplace for commercial assets and vehicles.

As part of the transaction, shareholders of the New York Stock Exchange (NYSE) listed IAA will receive $10 in cash and 0.5804 shares of Ritchie Bros.

Ann Fandozzi — Ritchie Bros CEO said: “IAA accelerates our journey to become the trusted global marketplace for insights, services, and transaction solutions.

“Their highly complementary business in an adjacent vertical will allow us to unlock additional growth.”

Ritchie Bros to acquire online vehicle marketplace IAA for $7.3bn. Image courtesy of IAA, Inc.

Ritchie Bros. shareholders will own around 59% of the combined entity while IAA’s shareholders will own approximately 41%, according to the merger agreement.

IAA with an annual gross transaction value of approximately $8.6 billion operates over 210 facilities across the US, Canada, and Europe. Ritchie Bros, on the other hand, has more than 40 owned and 24 leased facilities around the world.

John Kett — IAA CEO and President said: “Together, IAA and Ritchie Bros. will have expanded global operations, accelerating international buyer development and enhancing ancillary services such as transportation and finance.

“The transaction will also provide compelling value to stockholders through the immediate cash component and the opportunity to participate in the substantial growth potential of our combined company with significant resources.”

Expected to be wrapped up in the first half of 2023, the transaction is subject to approval by Ritchie Bros and IAA’s shareholders, regulatory approvals, and other customary conditions.