Laying more groundwork to become publicly traded, the holding company for ADESA Inc. plans an initial public offering of 23 million shares of common stock.
KAR Auction Services Inc., which announced the IPO yesterday, is offering underwriters a 30-day option to purchase up to an additional 3.45 million shares on the same terms.
ADESA is the nation’s second-largest auto auction company, with 62 auction sites.
All shares being offered are being sold by the company. The initial public offering price is expected to range from $15 to $17, KAR says. That would raise $345 million to $391 million, not counting the allotment to underwriters.
Company shares are expected to be approved for listing on the New York Stock Exchange under the ticker symbol KAR.
KAR Auction Services said it intends to use the net proceeds to repay or repurchase its senior debt notes, or both. Proceeds and about $200 million in cash on hand also will be used to repay loans and pay termination fees.
KAR Holdings Inc. changed its name to KAR Auction Services last month to more accurately reflect its core auto auction businesses including Insurance Auto Auctions Inc., a salvage auto auction company.
Jim Hallett is KAR Auction Services CEO.