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Goldman Sachs considering a sale of Safe-Guard: Reuters
Posted on Thursday, 22 August 2019 13:51
Investment bank Goldman Sachs is exploring a disposal of auto warranty company Safe-Guard Products International in a deal that could be worth around USD 1.00 billion, including debt, people close to the situation told Reuters.

According to the same insiders, the lender is working with advisors on an auction for the group, which it picked up in 2012 for an undisclosed amount.

However, the sources, who asked not to be identified as the matter is still private, cautioned there can be no guarantee this process will lead to a deal.

Safe-Guard provides products to the motor vehicle industry, protecting consumers from the risks of ownership and complementing manufacturer’s warranties both during and after the factory guarantee period.

Founded in 1992, the group protects 11.00 million customers and administers nearly four million contracts per year, with 600 employees working from offices in Georgia, California and Toronto, Canada.

Some of Safe-Guard’s partners include Harley-Davidson, Honda, Mercedes, Mini and Nissan.

Reuters observed that following the 2008 financial crisis market conditions in the auto warranty sector have been progressively improved, particularly in recent years.

The motor vehicle and parts industry as a whole has been targeted in 212 deals announced worldwide in 2019 to date, according to Zephyr, the M&A database published by Bureau van Dijk.

In the largest of these, TDR Capital, via BBD Bidco, is buying BCA Marketplace, a second-hand automobile auction market in the UK, for GBP 1.91 billion.

The second-biggest deal took the form of a capital increase by China Grand Automotive Services Group, which raised CNY 3.60 billion (USD 509.73 million) through a sale of convertible bonds.

Automotive Holdings, Sichuan Jinyu Automobile, Pendragon and CarMax, among others, have also been targeted this year.

© Zephus Ltd