KAR Auction Services Inc., parent company of ADESA Inc., began selling its shares on the New York Stock Exchange on Friday, Dec. 11, under the symbol “KAR.”
The initial public offering of 25 million shares of common stock was priced at $12 per share. The price is well below the $15 to $17 range the company outlined in a Nov. 30 press release.
The stock today closed at $12.00 a share on light trading, down 3 cents.
The company offered underwriters a 30-day option to purchase up to an additional 3.75 million shares of common stock at the IPO price.
Including those shares, 81 percent of the auction company remains in the hands of equity sponsors, equity co-investors and KAR managers and employees, according to documents filed with the U.S. Securities and Exchange Commission.
For the 12-month period that ended Sept. 30, the company posted a net loss of $31.4 million on revenue of $1.7 billion. The company had debts totaling $2.5 billion.
Key shareholders include private-equity firms Kelso & Co., Parthenon Capital; ValueAct Capital and Goldman, Sachs Capital Partners. Jim Hallett, auction veteran and KAR CEO, is also a shareholder.
KAR Auction Services sold 3.2 million vehicles in 2008 for consignors and has 150,000 registered buyers.
ADESA, the nation’s second-largest auto auction company, operates 62 auction sites in North America. KAR Auction Services also owns Insurance Auto Auctions Inc., which operates 152 salvage locations.