Richie Bros. Receives Go-Ahead to Complete Acquisition of IronPlanet
Ritchie Bros. has received the go-ahead from the U.S. Department of Justice to complete its $758.8 million acquisition of online auctioneer IronPlanet.
The deal will combine the world’s largest auctioneer of heavy equipment and commercial vehicles with a leading online marketplace to create what company officials describe as a “digital information and insights powerhouse.”
“In IronPlanet, we found a company that allows us to continue our rich history of innovation and gives us the tools and talent to transform into a digital information and insights powerhouse,” said Ravi Saligram, CEO of Ritchie Bros. in Vancouver, British Columbia. “The missions of our companies are aligned: deliver maximum choice and value to the customers.”
IronPlanet Chairman and CEO Greg Owen said, “The management team and employees of IronPlanet are enthusiastic about joining forces with Ritchie Bros. The possibilities are endless when you merge brand strength with technology. We are inspired by the vision of leading a digital transformation in the industry.”
Ritchie Bros. announced plans to acquire IronPlanet in August 2016. The companies, on a pro forma basis, sold more than $3 billion of assets through online transactions for the 12 months ended June 30, 2016, company officials said at the time.
Ritchie Bros. also announced that it would become Caterpillar Inc.’s preferred global partner for live on-site and online auctions once the deal is completed.
Launched in 1958 in Kelowna, British Columbia, Ritchie Bros. operates 45 permanent auction sites in North America, Europe, the Middle East, Asia and Australia. The company is publicly owned with stock traded on the New York Stock Exchange and the Toronto Stock Exchange.
In 2016, Ritchie Bros. conducted 356 unreserved public auctions and sold more than $148 million of equipment and other assets through its EquipmentOne online division. Overall, the company last year generated revenue of $566.4 million, an increase of 10% over $515.9 million in 2015. Profits slipped, however, to $91.8 million, or 85 cents a share, in 2016 from $136.2 million, or $1.27 a share, in 2015.
IronPlanet was started in 1999 as a site for selling surplus construction equipment. In 2013, the company launched TruckPlanet to focus exclusively on sales of commercial trucks. Based in Pleasanton, Calif., IronPlanet has received financial backing from investment firms Accel Partners and Kleiner Perkins Caufield & Byers, along with equipment manufacturers Caterpillar and Volvo.
Ritchie Bros. completed several other acquisitions during the past year, including Mascus, an online used-equipment listing firm in Europe; Kramer Auctions, a regional agricultural auctioneer in Canada; and Petrowsky Auctioneers, an industrial auctioneer in the northeast United States. The company also agreed to buy out the 49% stake in Ritchie Bros. Financial Services owned by a minority partner.
Stacy Tracy, national director of sales for Taylor & Martin Inc. Auctioneers in Fremont, Neb., said online transactions account for about 30% of the company’s business and is growing, although he doubts it will ever overtake on-site auctions, at least for truck purchases.
Taylor & Martin specializes in selling tractors and trailers and launched its online sales platform, TMILive, in 2009. Last week, the company rolled out a new application for use on mobile communications devices.
“Millennials are more comfortable with the technology, but buying a tractor is more personal and people have a stronger interest to see and inspect the vehicle,” Tracy explained.
He said that he sees no direct impact on Taylor & Martin’s business as result of the Ritchie Bros.-IronPlanet deal.
“I do not see a change in the course of our business.” Tracy told Transport Topics in an interview May 23. “At least it’s too early to see what difference it might make.”
Taylor & Martin conducted 38 on-site auctions and five complete fleet dispersals in 2016, selling 10,387 tractors and trailers, Tracy noted. Sales volume to date this year is up although prices are down, he added.
Other U.S.-based truck auction firms include US Auctioneers Inc., Fort Wayne Auto Truck Auction, Alex Lyon & Son, DoveBid.com, Capital Recovery Group, Comly Auctioneers, Hilco Industrial, Myron Bowling Auctioneers, Heritage Global Partners and Manheim Specialty Auctions.
