AutoCanada Inc. has sold a minority stake in its new online F&I business to insurer iA Financial Group, as the dealership group prepares to ramp up the initiative with online seller Kijiji.ca.
iA Financial will pay $25 million for a 10-per-cent interest in the unit, which will sell financing, insurance and extended warranty products to buyers of for-sale-by-owner vehicles listed on Kijiji's online marketplace. The insurer will also become the exclusive provider of these insurance and warranty products as part of the agreement.
AutoCanada will retain a 90-per-cent interest in the Kijiji partnership following the transaction.
The Edmonton-based dealership group that owns 83 new-vehicle stores in Canada and the United States announced the exclusive F&I collaboration with Kijiji last March. It began building the “operational foundation” to launch the service shortly after.
The company said the year-end deal with iA comes ahead of a “material ramp” in the online partnership.
The new set of services offered to Kijiji buyers is the latest addition to AutoCanada’s Used Digital Division, which includes traditional brick-and-mortar used-car dealerships, a used-vehicle auction platform and an instant cash offer tool already used on Kijiji.ca.
