KKR, Apollo Global Management and Clayton Dubilier & Rice are reported to be among private equity firms considering a buyout of KAR Auction Services, in a deal that could fetch over $4bn.
KAR has hired Evercore Partners to handle the sale process and is understood to be in the early stage of talks, Reuters reported, citing several people familiar with the matter.
Carmel, Indiana-based KAR, the number two used-car wholesale auctions business behind Cox Enterprises, is about 78 per cent owned by Kelso & Co, Goldman Sachs Capital Partners, ValueAct Capital and Parthenon Capital, the report added.
The company generated EBITDA last year of $487m and is expected to post EBITDA of over $500m this year, the report said, adding that no trade buyers were likely to bid given the duopolies in the used-car wholesale and salvage auction markets.
The business was taken private in 2007 in a $3.7bn deal by investors, who then raised $332m after relisting the company two years later, the report added.
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