KAR Raises $550 Million Funding

By Staff Writer May 27, 2020

KAR Auction Services Inc. has announced the placement of $550 million in newly issued perpetual convertible preferred stock of KAR Global. The preferred stock has a 7.0 percent dividend, which shall be paid in-kind for the eight quarters following closing, and thereafter in cash or in-kind at KAR’s option. The initial conversion price of $17.75 per share represents an approximately 42 percent premium to KAR’s closing price of $12.52 per share on May 22. The investment was led by funds advised by Apax Partners, a global private equity advisory firm, with participation by Periphas Capital L.P. The proceeds of the transaction will be utilized to expedite the resumption of operations to meet market demand, sustain the company’s technology platforms and development pipeline and navigate the industry and economic recovery.

“This transaction will help us continue to support our global customers and further accelerate our digital transformation. Apax is the right strategic partner for our company, employees and stockholders, and their investment reinforces the strength of our brands, market position and long-term strategy for growth and expansion,” said Jim Hallett, Chairman and CEO of KAR.

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Last modified on Wednesday, 27 May 2020 16:35