Earlier this year, Hagerty purchased approximately 40% of Broad Arrow Group (Broad Arrow) as part of its automotive Marketplace strategy, which aims to provide consumers with new trust-based platforms for buying, selling, and financing collectible cars.
Hagerty is now acquiring the remaining 60% of Broad Arrow in an all-stock transaction for $64.8 million, with a closing date of August 16, 2022.
"We are a natural fit because the Broad Arrow Group team shares our ethos of excellence when it comes to customer experience, in addition to being trusted experts in their field," said McKeel Hagerty, CEO of Hagerty. "As we plan to rapidly scale this part of our overall business, we expect our additional investment in Broad Arrow to boost our growth and profitability over time."
According to Hagerty, the live and online collector car auction industry represents a significant financial opportunity for the company. In the 12 months ending June 30, 2022, Hagerty members bought and sold over 300,000 collectible cars worth nearly $12 billion. The Broad Arrow acquisition will provide immediate growth opportunities in an enticing proximity to the Hagerty ecosystem of products and services serving the vast collectible car market and enthusiasts worldwide.
"We saw the compelling value proposition for the two organizations to fully integrate after working together for a few months," said Kenneth Ahn, CEO of Broad Arrow Group. "We look forward to serving the collectible car community as part of Hagerty's comprehensive ecosystem of products and services in the coming years."
Hagerty Marketplace offers a user-friendly proprietary automotive classified platform that connects buyers and sellers. Marketplace also gives users access to Hagerty's automotive-focused offerings, such as Hagerty Media and Hagerty Valuation Tools. Hagerty also acquired Speed Digital in April 2022, an industry leader in cloud-based technology solutions for dealers, auction houses, collectors, and enthusiasts.
Broad Arrow will hold its first live auction on August 18th in Monterey, California, in conjunction with Hagerty's Motorlux event (formerly McCall's Motorworks Revival), which will be held at the Monterey Jet Center. Within the grounds of this spectacular event, the auction will feature 90 exceptional motorcars, kicking off Monterey Car Week in grand style.
As part of the deal, Broad Arrow founders and industry veterans Kenneth Ahn, Alain Squindo, Ian Kelleher, Donnie Gould, Barney Ruprecht, Alexander Weaver, David Swig, Karsten Le Blanc, Ramsey Potts, Madeline Baker, and Mike Mortorano will join the Hagerty team, and Kenneth Ahn will continue to lead the team as President of Hagerty Marketplace.