Constellation Automotive Group

We have spent a significant amount of time in recent years analysing the automotive market generally and the automotive aftermarket more specifically. Our experience at LeasePlan, both as a significant seller of vehicles through B2B channels as well as through the creation of the high-quality used car European online marketplace CarNext.com, has given us a particular insight into the complex and fragmented value chain that characterises the automotive aftermarket across Europe. Having reviewed a number of assets in the automotive aftermarket space, we were drawn to Constellation due to its unique and defensive business model, which was underpinned by the scale and breadth of its operations and its critical role in servicing the needs of the major players across the automotive landscape, such as dealers, fleet managers and leasing companies, car rental companies and OEMs. In summer 2019 we agreed the terms of an offer for the Constellation shares and the take private of the company was completed in November 2019. Since TDR’s investment, Constellation has undergone a shift from physical to digital auctions with 100% of the remarketing activity in Europe now taking place online, marking a significant shift in the company’s operating model. Furthermore, Cinch was launched in October 2020 and has quickly established itself as the largest online B2C marketplace for used cars in the UK. Cinch allows its c. 30 million unique visitors a year to part exchange their car and buy or finance quality-checked used cars fully online and have them delivered straight to their home. Cinch has established itself as one of the fastest growing consumer brands in the UK and a major sponsor of well-known sports teams and events such as the England Cricket team, Tottenham Hotspur, the Northampton Saints and the upcoming tennis Cinch Championship at Queen’s Club. In October 2021, Constellation completed the acquisition of CarNext, a leading high quality used car digital marketplace in Continental Europe. CarNext originated from a used vehicle remarketing division within LeasePlan, a TDR III portfolio company and was carved out into a standalone business in July 2021. The highly synergistic combination offers significant mutual benefits, with Constellation gaining access to an established B2C platform and brand in Continental Europe thereby accelerating its expansion in the continent.