Angelo, Gordon & Co. has exited its investment in Dealer Services Corp., an independent inventory financing provider of used vehicles. Terms were not released. The buyer was Manheim Inc., a division of Cox Enterprises.
Angelo, Gordon & Co. (“Angelo Gordon”) announced today that the firm’s Private Equity Group has sold Dealer Services Corporation (“DSC”), America’s largest independent inventory financing provider of used vehicles sold by dealers, to Manheim, Inc. (“Manheim”), a division of Cox Enterprises.
DSC was founded in 2005 by Chairman John Fuller in partnership with Angelo, Gordon’s Private Equity Group (“AGPE”) and Noro-Moseley Partners. AGPE saw an opportunity to back an industry-leading management team, including CEO Brian Geitner and President Marty McFarland, in an attractive space with few scaled independent players. The company today originates over $3 billion in loans annually and works with nearly 10,000 dealers to finance the purchase of vehicles from over 1,000 inventory sources, manufacturers, and wholesalers through their Universal Source Network. DSC is renowned for their unparalleled customer service through innovative technology and a unique employee culture dedicated to the dealers’ success.
David Roberts, a Senior Managing Director of AGPE remarked, “It has been great to watch the management team scale DSC over the past few years into an industry leader. This has been a very successful investment for AGPE, its investors and our management partners, and we believe this will be an equally successful transaction for Manheim as they help grow DSC to the next level.”
John Fuller, Chairman, added, “We appreciate the support from AGPE at each stage of our growth, and in particular during the financial crisis. We have enjoyed having access to the broader Angelo Gordon network and resources throughout our partnership with the firm.”
The current DSC management team will continue to manage the company going forward in partnership with the Manheim management team. “Our mission of empowering our customers with strategic products and services is only more enhanced by joining the Manheim group of companies. It’s easy to see how Manheim Financial Services’ and DSC’s service platforms will complement each other and broaden Manheim’s ‘service reach’ across the country. We are proud to add the DSC brand to Manheim’s strong lineup of products, services and companies,” said Brian Geitner.
AGPE makes equity investments ranging from $25 million to $125 million. Sector focus includes financial services, healthcare, and consumer/retail.
“The sale of DSC, similar to the recent sales of Gateway One and Global Compliance, highlights our Firm’s ability to back management teams and provide the resources to help nascent platforms achieve scale,” said Arthur Peponis, Co-Head of AGPE. “We actively seek out opportunities to invest in companies and industries that have a strong track record of growth. This investment strategy will continue to be an area of focus for our Private Equity Group going forward.”
William, Blair & Company acted as the financial advisor and Mayer Brown LLP acted as legal advisor to Dealer Services Corporation.
About Angelo, Gordon & Co.
Angelo, Gordon & Co., L.P. is a privately held limited partnership founded in November 1988, and currently manages approximately $24 billion. The Firm’s investment focus centers around three core competencies – credit, real estate, and private equity – and manages capital across five principal areas: (i) distressed debt and leveraged loans, (ii) real estate equity and debt and net lease, (iii) residential and commercial mortgage-backed and asset-backed securities, (iv) private equity, and (v) multi-strategy. Angelo, Gordon has over 260 employees (100 of whom are investment professionals) and is headquartered in New York, with associated offices in Chicago, Los Angeles, Washington D.C., London, Amsterdam, Hong Kong, Seoul, Shanghai, Tokyo, and Sydney. For more information, visit www.angelogordon.com.
About Dealer Services Corporation
Dealer Services Corporation offers full service operations throughout the U.S. and is the largest independently-owned inventory finance provider for used automobiles. DSC provides flexible and cost effective inventory financing solutions to dealership operations in the areas of: Retail, Wholesale, Rental, Salvage, and various aftermarket products including Insurance and Lender Access.