Manchester-based FTSE 100 firm Auto Trader Group plc has agreed to acquire Autorama (UK) Limited, which it called “one of the UK’s largest transactional marketplaces for leasing new vehicles.”

Auto Trader will pay an initial £150 million in cash, with a further £50 million of deferred consideration to be paid in shares “subject to customary performance conditions 12 months after the completion date.”

Autorama had £27 million of gross assets at December 31 and made net 2021 revenue of £26 million, selling 14,500 vehicles.

Completion of the transaction will be subject to applicable regulatory approvals.

“The acquisition will transform Auto Trader’s existing leasing proposition and help to meet the demands of the growing number of consumers who might consider leasing their next new vehicle,” said Auto Trader.

“In time, it will enable Autorama to leverage Auto Trader’s brand to accelerate its recent expansion, beyond light commercial vehicles, into leasing new cars.

“There is a large structural opportunity for a new car leasing marketplace driven by the growth of electric cars, new manufacturers entering the UK market, lower take up of company car schemes and a shift towards new digital distribution models.

“Leasing provides consumers a cost-effective way to access a new car with a model that is consistent with any future move towards usership.”

Auto Trader CEO Nathan Coe said: “To ensure we have the largest choice of cars to buy online, we could not ignore the growing demand for leasing deals.

“In Vanarama, we have found an industry leading leasing platform that delivers a great consumer experience and significant sales for its partners.

“This acquisition will strengthen our leasing business and will enable us to offer both the biggest choice of vehicles and a seamless digital experience from search to sale.

“I am delighted to be welcoming Andy and his team to the group.”

Autorama CEO Andy Alderson said: “As the leading aggregator of leasing deals online, we have sold over 120,000 vehicles for our manufacturer, retailer and lease company partners.

“Over the last few years we have invested significantly in our technical capability to help our partners respond to the high levels of consumer demand for a digital buying experience.

“We are hugely excited about the prospect of being able to accelerate our growth plans and deliver even more value to our partners as part of the Auto Trader Group.”