Online automobile eCommerce startup Vroom is moving to acquire automotive finance firm United Auto Credit Corporation (UACC) for $300 million in an all-cash transaction, according to a press release emailed to PYMNTS on Tuesday (Oct. 12).
The acquisition will help Vroom drive its strategy to integrate captive financing operations to strengthen and expand sales, boost revenues, reduce costs per unit and bring continuing value to shareholders.
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“Competitive financing is a fundamental component of Vroom’s value proposition, and adding proprietary lending capabilities unlocks significant value for our business and our customers,” said Paul Hennessy, Vroom CEO.
Hennessy added that UACC brings a “depth of expertise” that complements Vroom’s lending product and is a “meaningful strategic opportunity” that has the capability to boost profits and consumer confidence.
Read more: Vroom eCommerce Sales Jump 172% as Data Enables Lower Prices, Rapid Turnover
As a combined entity, UACC’s non-prime lending capabilities will be integrated with Vroom to offer customers vehicle purchasing and financing on one digital platform. UACC’s solution will add to the current suite of lenders available on the eCommerce platform.
UACC works with over 7,300 dealership customers and will continue to maintain those relationships and develop new ones. UACC CEO and President Jim Vagim will remain in his position, as well as UACC Managing Director and CFO Ravi Gandhi.
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“We have always been focused on providing as many consumers as possible the chance at vehicle ownership through our deep lending capabilities and market expertise,” said Vagim.
When the acquisition is complete, UACC will keep its branding and will operate as an indirect, wholly-owned subsidiary of Vroom, according to the release. The deal is anticipated to close before the end of this year or early next year.
In December, Vroom entered into a deal to buy artificial intelligence (AI)-fueled analytics and digital services company CarStory via the purchase of Vast Holdings, Inc.
See also: Vroom to Buy AI-Powered Analytics and Digital Services Firm CarStory
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