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IAA, Inc. (NYSE: IAA) has received clearance from the UK's Competition and Markets Authority for its £225 million acquisition of SYNETIQ Ltd., a major salvage and vehicle dismantling firm. The CMA's approval concludes an initial enforcement order from November 2021, allowing IAA to fully integrate SYNETIQ into its operations. With 15 locations in the UK and around 500 employees, SYNETIQ specializes in salvage auction services and sustainable practices. A remaining payment of $54 million will be released following this approval.
Positive
CMA approval allows for full integration of SYNETIQ, enhancing IAA's service capabilities in the UK.
Acquisition valued at £225 million, indicating strong investment in market expansion.
SYNETIQ's sustainable practices align with IAA's commitment to environmental initiatives.
Negative
None.
WESTCHESTER, Ill.--(BUSINESS WIRE)--
IAA, Inc. (NYSE: IAA), a leading global digital marketplace connecting vehicle buyers and sellers, today announced that the UK’s Competition and Markets Authority (“CMA”) has cleared IAA’s acquisition of SYNETIQ Ltd. (“SYNETIQ”), a leading integrated salvage and vehicle dismantling company in the United Kingdom, for £225 million. The businesses were previously required to be held separate under an initial enforcement order (IEO) issued by the CMA on November 5, 2021. However, the IEO was revoked by the CMA on February 10, 2022, and the announcement today paves the way for full integration of the two businesses. The CMA approved the transaction without any conditions. All regulatory approvals and consents are now secured.
On October 26, 2021, IAA, Inc. acquired the stock of SYNETIQ through its indirect wholly owned subsidiary IAA International Holdings Limited. SYNETIQ provides salvage auction services for insurance companies, accident management companies, and other public and private sellers. The company is an environmental leader and sells parts from salvage vehicles which re-enter the automotive supply chain. SYNETIQ has 15 locations and approximately 500 employees throughout the United Kingdom.
In accordance with the terms of the agreement to acquire SYNETIQ, IAA will be paying to SYNETIQ the remaining payment of $54.0 million (£39.2 million) that was being held in an escrow account pending receipt of CMA regulatory approval.
John Kett, Chief Executive Officer and President of IAA, said, “We are thrilled to receive regulatory approval from the CMA and officially welcome the SYNETIQ team to IAA. This transaction will significantly expand IAA’s business and services in the United Kingdom, and we are excited to work together to meet our customers’ growing needs. SYNETIQ’s focus and expertise on green parts will be an excellent addition to our focus on sustainability in the UK and around the world. We look forward to moving forward with the integration process.”
Tom Rumboll, Chief Executive Officer of SYNETIQ, said, “We are proud to join IAA, a leading global digital marketplace with a significant international footprint. I am also very excited to work with Managing Director Steve Hankins and his entire IAA team in the UK. As a combined entity, our diversified portfolios and proven management teams will be tremendous assets as we work to make the vehicle salvage industry more sustainable. We are grateful to IAA for this opportunity and are excited about the long-term opportunities of our shared business.”
About IAA
IAA, Inc. (NYSE: IAA) is a leading global digital marketplace connecting vehicle buyers and sellers. Leveraging leading-edge technology and focusing on innovation, IAA’s unique platform facilitates the marketing and sale of total-loss, damaged and low-value vehicles. Headquartered near Chicago in Westchester, Illinois, IAA has nearly 4,500 employees and more than 210 facilities throughout the U.S., Canada and the United Kingdom. IAA serves a global buyer base – located throughout over 170 countries – and a full spectrum of sellers, including insurers, dealerships, fleet lease and rental car companies, and charitable organizations. Buyers have access to multiple digital bidding and buying channels, innovative vehicle merchandising, and efficient evaluation services, enhancing the overall purchasing experience. IAA offers sellers a comprehensive suite of services aimed at maximizing vehicle value, reducing administrative costs, shortening selling cycle time and delivering the highest economic returns. For more information visit IAAI.com, and follow IAA on Facebook, Twitter, Instagram, YouTube and LinkedIn. For more information about IAA in the UK visit IAAIUK.co.uk, and follow IAA in the UK on Facebook, Twitter, Instagram, and LinkedIn.
Forward-Looking Statements
Certain statements contained in this release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and which are subject to certain risks, trends and uncertainties. In particular, statements made in this release that are not historical facts may be forward-looking statements. Words such as "should," "may," "will," "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates" and similar expressions identify forward- looking statements. Such statements include statements regarding the expected benefits of the acquisition of SYNETIQ Ltd and its integration into IAA’s business. Such statements are based on management’s current expectations, are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from the results projected, expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to: uncertainties regarding ongoing surges of COVID-19 infections, including new more contagious and/or vaccine resistant variants, and the impact on the duration and severity of the COVID-19 pandemic and measures intended to reduce its spread, including the availability, rate of public acceptance and efficacy of COVID-19 vaccines; the loss of one or more significant vehicle suppliers or a reduction in significant volume from such suppliers; our ability to meet or exceed customers’ demand and expectations; significant current competition and the introduction of new competitors or other disruptive entrants in our industry; the risk that our facilities lack the capacity to accept additional vehicles and our ability to obtain land or renew/enter into new leases at commercially reasonable rates; our ability to effectively maintain or update information and technology systems; our ability to implement and maintain measures to protect against cyberattacks and comply with applicable privacy and data security requirements; our ability to successfully implement our business strategies or realize expected cost savings and revenue enhancements, including from our margin expansion plan; business development activities, including acquisitions and the integration of acquired businesses, and the risks that the anticipated benefits of any acquisitions may not be fully realized or take longer to realize than expected; our expansion into markets outside the U.S. and the operational, competitive and regulatory risks facing our non-U.S. based operations; our reliance on subhaulers and trucking fleet operations; changes in used-vehicle prices and the volume of damaged and total loss vehicles we purchase; economic conditions, including fuel prices, commodity prices, foreign exchange rates and interest rate fluctuations; trends in new- and used-vehicle sales and incentives; and other risks and uncertainties identified in our filings with the Securities and Exchange Commission (the “SEC”), including under Item 1A “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on February 28, 2022, as such risk factors may be amended, supplemented or superseded from time to time by other reports we file with the SEC, including subsequent Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K. Many of these risk factors are outside of our control, and as such, they involve risks which are not currently known that could cause actual results to differ materially from those discussed or implied herein. The forward-looking statements in this release are made as of the date on which they are made and we do not undertake to update our forward-looking statements.
