After purchasing a minority stake in the company in early 2020, CarMax said Thursday it will acquire the remaining shares of Edmunds.
The retailer invested $50 million in the online car shopping guide [2] in January 2020, acquiring a minority stake.
The deal for CarMax to acquire full ownership of Edmunds is expected to close in June, with a “purchase price that implies an enterprise value of $404 million, inclusive of CarMax’s initial investment, which we expect to be paid in a combination of cash and stock,” the retailer said in a news release.
“We are excited to bring the iconic Edmunds brand, history of innovation, and exceptional technology and creative talent into the CarMax family,” CarMax president and chief executive officer Bill Nash said in the release.
“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,” Nash said. “We look forward to supporting and investing in Edmunds’ continued growth and are excited about the many opportunities ahead for both CarMax and Edmunds.”
Edmunds will continue operating independently when the deal closes. Its focus will continue to be on “delivering confidence to consumers and exceptional value to its dealer and OEM clients,” according to the release.
“For over 50 years, Edmunds has been delivering value to automotive shoppers, making the entire car-buying process easier,” Edmunds CEO Avi Steinlauf said. “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.”
Since CarMax’s investment in Edmunds more than a year ago, the companies have partnered on several projects. Among those was one that provided online instant offers for consumers selling used cars.
“The instant offer products on Edmunds.com and CarMax.com have put CarMax in the position to become the largest online buyer of used autos from consumers,” Nash said.
Future collaborations between the companies are in the pipeline, CarMax said in the release.
