Constellation Automotive

Investment Thesis

• Market leader
• Defensive business model
• B2C sales opportunities
• Strong cash flow generation

Investment Overview

Constellation (FKA BCA) plays a critical role in the car market, enabling large vendors such as dealers, fleet managers, OEMs, and car rental companies to sell their stock of used cars using Constellation’s auction platform primarily to used car dealerships. Constellation sells approximately 1.5 million used cars a year and employs over 7,200 people. It has also built a sizeable business “We Buy Any Car” (“WBAC”), purchasing cars directly from consumers in the UK for resale through Constellation’s remarketing division, buying approximately 340,000 cars a year.

In October 2020, Constellation launched Cinch, an online marketplace enabling Constellation to sell its stock of used cars directly to consumers and advancing Constellation on its path to become an end-to-end digital marketplace. Cinch enables customers to buy a used car and to trade in their old one at the same time, as well as offering a range of ancillary services such as financing, insurance, warranty and delivery.