Shift agrees to buy Fair’s dealer listing marketplace tech, team in move to launch dealer marketplace
What a wild season for the used-car market.
In the latest of a string of M&A developments, new entrants to the wholesale market and moves that have generally shaken up the pre-owned landscape, Shift announced Tuesday that it has signed a deal to acquire certain assets of Fair Technologies.
Those assets being Fair’s dealer listing marketplace technology and team — which will give Shift the ability to launch a dealer marketplace product in the second quarter.
The price of the deal would include a combination of cash and shares of Shift’s Class A common stock.
Shift has entered a commitment letter with SoftBank Group, in which SoftBank would purchase senior unsecured notes due in 2025. That will be used to fund the acquisition.
“Shift and Fair share the same goal: to simplify the used vehicle purchasing process and empower customers through the entire lifecycle of car ownership,” Shift co-founder and chief executive George Arison said in a news release.
“At Shift, we’ve long envisioned building a digital marketplace where both dealers and independent sellers can list their cars alongside Shift’s owned inventory, offering customers access to a greater selection of owned and third-party vehicles for a test drive or direct purchase — with all transactions fulfilled through Shift’s proprietary logistics network.”
In the release, Arison said the purchase gets the ball rolling on Shift’s plans for a marketplace and accelerates the launch timeline to the second quarter, “rather than years from now,” he said.
“When launched, the dealer marketplace will expand our inventory assortment, accelerate retail sales growth, and provide further leverage on our marketing and brand investments, among many other benefits we anticipate across the business,” Arison said.
Fair has been building an online market platform the past 18 months that allows consumers to shop cars from dealer partners, line up financing from an in-platform finance provider network and sign for the vehicle digitally.
Dealers would be able to manage the sale through a proprietary digital onboarding platform and schedule home delivery.
“The platform is the ideal solution for dealers to participate strategically in e-commerce, grow market share and develop long-term relationships with customers,” Shift said in the release. “Its technology, team and deeply established dealer relationships will allow Shift to accelerate its vision of becoming the destination marketplace for car ownership.”