DALLAS, October 8, 2020 /PRNewswire/ — Auto Experience, Inc., formed in 2018 to pursue strategic business opportunities in the automotive finance market, today announced that it has briefed the board of directors of Consumer Portfolio Services, Inc. (Nasdaq: CPSS ) his interest in acquiring the company in a cash transaction valued at $135 million. An acquisition at this price would almost double the current value of the Nasdaq-listed company.
Situated at Irvine, California., Consumer Portfolio Services (CPS) is an independent specialty finance company that provides indirect automotive financing to consumers. In a October 7, 2020 letter to the company formally transmitting an “indication of interest”, Auto Experience stated that it offered to acquire CPS for approximately $6.18 per ordinary share. CPS stock closed at $3.35 on October 7, 2020.
In its letter to CPS, Auto Experience said it would add value to the company and its shareholders by reorganizing aspects of CPS’s operations, applying proprietary technology and enhanced digital capabilities as the market evolves. increasingly online, and using a combination of existing resources and new leadership steeped in auto finance and digital commerce.
“Acquiring Consumer Portfolio Services and leveraging our strategic and operational experience in auto finance and enterprise technology will create a strong national player that already has a grip on more than 8,000 auto dealerships across the states. United,” said Samuel M. Ellis, President and CEO of Auto Experience. “CPS is significantly undervalued based on a range of upside performance metrics and growth opportunities, and we believe our acquisition proposal would materially benefit shareholders and, over the longer term, for consumers and dealers.”
Mr. Ellis brings to this opportunity extensive entrepreneurial and operational experience in automotive finance and digital commerce. In addition to his leadership of Auto Experience, which focuses on the strategic application of technology and digital innovation in the auto finance market, Mr. Ellis was previously the founder and CEO of dallasDriverUp, an online marketplace focused exclusively on car financing. Previously, he was founder and CEO of Exeter Finance Corp., also based in Dallas. For nearly a decade, Mr. Ellis served as senior vice president of risk management for GM Financial/AmeriCredit, the finance arm of General Motors Corp.
Consumer Portfolio Services’ business is based on the purchase of retail installment contracts from franchise automobile dealerships, the financing of contract purchases primarily through securitization markets, and the servicing of contracts throughout their term. of life. CPS began operations in 1991 and has purchased nearly $17 billion in contracts from its inception through the first half of 2020. At mid-year, it said it was actively managing a contract portfolio of approximately $2.3 billion and 173,000 customers. CPS’s turnover for the year 2019 was $346 million with a net income of $5.4 million.
In its letter to the company, Auto Experience requested a response from the CPS Board of Directors in October 30, 2020.
About the Automatic Experience
Auto Experience is focused on strategic acquisitions that will advance the development of consumer online automotive finance transactions and other consumer services in the automotive vertical. The company targets strategic opportunities that can turn good organizations into great ones through the re-engineering of technology, operations and capitalization. Auto Experience focuses on opportunities that have teams and stakeholders inspired and committed to improving the consumer experience across all areas of the automotive retail space. Visit our website at www.autoexperience.info.
JCUTLER Media Group
SOURCE Auto Experience, Inc.