Used-vehicle retailer CarMax announced that it has signed a definitive agreement to acquire Edmunds, one of the most notable automotive research and vehicle-listing firms in the industry. CarMax had already held a $50 million minority stake in the company before acquiring the entire enterprise in a transaction valued at $404 million.
According to a press release, the deal is expected to close in June 2021. CarMax says that Edmunds will continue to operate independently after the deal is complete.
“We are excited to bring the iconic Edmunds brand, history of innovation, and exceptional technology and creative talent into the CarMax family,” said Bill Nash, CarMax’s President and Chief Executive Officer. “Our partnership to date has proven to be an outstanding combination as we’ve developed innovative products and advanced our shared commitment to delivering the highest quality online experience. We look forward to supporting and investing in Edmunds’ continued growth and are excited about the many opportunities ahead for both CarMax and Edmunds.”
In 2020, Edmunds generated unaudited revenue of approximately $140 million. CarMax said in the release that it expects Edmunds’ net income to be immaterial in the company’s current financial year, with the potential for “significant shareholder value” in the long term.
“For over 50 years, Edmunds has been delivering value to automotive shoppers, making the entire car buying process easier,” said Avi Steinlauf, CEO of Edmunds. “We have found a great partner in CarMax, with whom we look forward to continuing to grow and support our shoppers, as well as our dealer and OEM partners, while providing continuous innovations to the market. I am excited about the next chapter in Edmunds’ evolution.”
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