CARY, N.C. -

XLerate Group said Wednesday it has entered a definitive agreement to buy America’s Auto Auction; a deal that will create a supergroup of more than three dozen auto auctions.

The companies did not disclose terms of the deal.

The purchase is arguably one of the most significant in the recent history of the auto auction business.

Granted, there certainly have been other auction group consolidations in the last handful of years. But not at this scale.

America’s Auto Auction purchased Auction Broadcasting Company in 2017; a move that increased its footprint to 19 locations at the time.

And ADESA purchased the eight Brasher’s auctions the previous year.

But this move would consolidate the two largest groups of independent auctions into an entity nearly 40 locations strong.

ADESA (with 70 auction locations, including the U.S. and Canada) and Manheim (111 physical/digital/mobile sites in the U.S.) are the only groups with more auction sites.

The combined company will include 39 auction locations in 19 states, digital and mobile auction businesses and related financing operations.

XLerate has fixed-site and mobile sales in California, Florida, Georgia, Illinois, Indiana, Louisiana, Michigan, New Mexico, Pennsylvania, South Carolina, Texas and Wisconsin. 

Bringing America's into the fold adds Alabama, Kentucky, Massachusetts, Missouri, Ohio, Oklahoma and Virginia to the mix, along with additional locations in most of the states where XLerate operates.

So while there is a small footprint overlap and the two groups have historically competed, the acqusition is largely a geographically complementary one, as XLerate chief executive officer Cam Hitchcock explained via phone Wednesday.

Hitchcock and XLerate’s current executive team will operate the company, including executive vice president and chief revenue officer Chuck Tapp and EVP/chief financial officer Charles Kunkel.

“The independent vehicle auction sector is poised for significant growth, as consumer demand expands, and technology continues to enhance the remarketing process,” Hitchcock said in a news release. “We are thrilled to welcome our talented colleagues at AAA, and appreciate the trust placed in us by Brightstar.

“Together, we will develop a platform built on lasting relationships and superior service that leverages the best of digital and physical offerings, and further redefines the remarketing industry,” he said.

America’s Auto Auction president and CEO Ben Lange added: “Since founding AAA in 2000, we have expanded to 23 locations across 15 states and developed a comprehensive and trusted auction process, from vehicle reconditioning, through physical or online auction bidding, financing and check-out.

“I look forward to the combined company building on this solid foundation and benefiting our employees, suppliers and customers.”

XLerate, which is headquartered in Carmel, Ind., is owned by affiliates of Brightstar Capital Partners.

Brightstar will be the controlling shareholder of the combined entity.

“We are excited to build one of the leading platforms in the auction marketplace,” Brightstar partner Gary Hokkanen said in a news release. “The exceptional talent and expertise of the XLerate and AAA teams, enhanced reach of the combined auction site networks, and Brightstar’s access to financial and operational resources, will ensure that this company continues its growth trajectory as a vital part of the vehicle sales ecosystem.”

Brightstar founder and CEO Andrew Weinberg added: “Our investment in AAA, following our earlier acquisition of XLerate, clearly indicates our confidence in the vehicle auction market and its value-creation potential for Brightstar investors.

“With an expansive network, unparalleled team, and expanded resources, Cam and his team are well-positioned to capitalize on the exciting prospects for this sector of the economy.” 

Brightstar completed its acquisition of XLerate in late September, after announcing the purchase earlier in the month.  It is now the majority owner of the auto auction and remarketing facilitation company.

As part of that deal earlier this year, former owner Huron Capital and XLerate’s senior management team were to retain minority equity stakes.

Trinity Hunt Partners has held a majority stake in America’s Auto Auction since April 2015. America’s Auto Auction is headquartered in Dallas.

Lange, America's CEO, and America's CFO Dustin Miller will not remain with the new company, Hitchcock said via phone.