Auto Trader completes acquisition of Autorama at nearly 16x gross profits

Auto Trader has completed the acquisition of new vehicle leasing platform Autorama, in a deal that could rise to £200 million. An initial consideration of £150 million was paid upon completion, with an additional £50 million deferred consideration, which is subject to certain performance conditions.

If the full £200 million was to be paid, this would represent slightly over a 15.8x multiple of Autorama’s gross profits of £12.6 million for the year ending December 31 2020, generated on turnover of £63.7 million. In those results, the company reported a post-tax loss of £8.1 million.

Autorama, which trades as Vanarama, was founded in 2004 by Andy Alderson (pictured above) as a used vehicle dealer, before moving in to B2B commercial vehicle leasing in 2007. The company has gone on to become one of the UK’s leading lease dealers, selling more than 120,000 vehicles so far.

The company’s digital platform aggregates leasing deals from a range of funders and OEMs (original equipment manufacturers). Auto Trader says that acquiring Autorama will help it to “establish itself as a leading marketplace for leasing new cars”.

Auto Trader adds that the leasing market “is set to benefit from the growth of electric cars, new manufacturers entering the UK market, lower take up of company car schemes and a shift towards new digital distribution models".

Post-acquisition, Auto Trader says it expects Autorama to generate net revenues of between £18 million and £21 million for the remainder of the financial year. However, it expects the business to register an operating loss of around £5 million to £7 million.

Commenting on the acquisition, Auto Trader CEO Nathan Coe said: “We are pleased to have completed the acquisition of Autorama, which will transform our leasing proposition and help us meet growing consumer demand to lease, rather than own, new cars.”

“The combination of Auto Trader’s large consumer audience with Autorama’s digital platform and operational capability complements our strategy to bring more of the car buying journey online.”


Read more about the factors spurring M&A in the automotive sector.

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