DALLAS, Oct. 8, 2020 /PRNewswire/ — Auto Experience, Inc., created in 2018 to pursue strategic business opportunities in the automobile financing market, today announced it has informed the board of directors of Consumer Portfolio Services, Inc. (Nasdaq: CPSS) of its interest in acquiring the company in an all-cash transaction valued at $135 million. An acquisition at that price would nearly double the current value of the Nasdaq-listed company.
Based in Irvine, Calif., Consumer Portfolio Services (CPS) is an independent specialty finance company that provides indirect automobile financing to consumers. In an October 7, 2020 letter to the company formally conveying an “indication of interest,” Auto Experience said it proposes to acquire CPS for approximately $6.18 per share of common stock. CPS shares closed at $3.35 on October 7, 2020.
In its letter to CPS, Auto Experience said it would add value to the company and its shareholders by re-engineering aspects of CPS’s operations, applying proprietary technology and enhanced digital capabilities as the market increasingly shifts online, and employing a combination of existing resources and new leadership steeped in automobile financing and digital commerce.
“Acquiring Consumer Portfolio Services and leveraging our strategic and operational experience in auto financing and enterprise technology will create a strong national player that already has a toe-hold in more than 8,000 automobile dealerships across the U.S.,” said Samuel M. Ellis, president and chief executive officer of Auto Experience. “CPS is significantly undervalued based on a range of performance measures and upside growth opportunities, and we believe our proposed acquisition would be materially beneficial to shareholders and, over the longer run, to consumers and dealers.”
Mr. Ellis brings deep entrepreneurial and operating experience in automobile financing and digital commerce to this opportunity. In addition to his leadership of Auto Experience, which is