The big winners from a merger of two leading auto finance firms
Auto finance services provider Nearco and payment processing firm Citi have announced a merger.
Nearco, which provides financing to small businesses, said in a statement on Thursday it has agreed to acquire Citi Automotive Finance for $5.6 billion in cash and shares.
“This transaction is a natural extension of our core business,” said Jim Oster, chief executive officer of Nearco.
“Our combined team will work closely with our existing and expanding partners to expand and grow our financial services offering, including in the auto finance market.”
The combined company will be led by Oster and Citi executive vice president of finance John B. Shaffer.
Shofer, who joined Citi in July, previously served as president and CEO of Nearby Financial Services.
Nearby has offices in New York, Los Angeles and San Francisco.
Shaffer previously was president and chief executive of the financial services giant Wells Fargo.
He previously worked at the credit bureau that operates Equifax, which suffered massive losses as a result of the fallout from the massive data breach last year.
In addition to the acquisition of Citi, Nearby will retain a large stake in its existing business.
Shafer said in the statement that Citi’s portfolio includes payment processing services, automotive financing, consumer and commercial loans, as well as financial services for financial institutions and investment advisers.
“Our combined capabilities and expertise will enable us to continue to provide our customers with the best possible service while maintaining our core value proposition and position in the industry,” Shaffer said.
“We are confident our combined services and capabilities will continue to be the most trusted and trusted by our clients and their financial institutions.”
For the past few years, Nearco has focused on providing a streamlined, online banking experience for businesses, as opposed to the complex, time-consuming processes and complexities that are often involved with online banking.
Shuster, the company’s CEO, said the merger will create a single online platform that will make it easier for customers to access services and make it more efficient for the financial sector.
“It’s a real strategic move that will allow us to focus on delivering the best and fastest service to our customers,” Shuster said.
Shafer said the merged company will continue its focus on creating the next generation of the industry’s most trusted banking solutions, including offering a “digital and mobile-first” approach to banking.
He said the combined company, which is based in New Orleans, will focus on “improving customer service, offering better pricing, and increasing transparency” through the merger.