TORONTO – Trade X Group of Companies Inc. (TRADE X), a global B2B cross-border automotive trading platform, announced that it has received an equity investment of C$44 million, or US$35 million, from Aimia Inc. (TSX: AIM), a Toronto-based holding company that invests in public and private companies globally. An additional US$10 million of convertible preferred shares may be issued by TRADE X to other strategic investors in a subsequent closing, to be held no later than August 6, 2021, to achieve the company's target round size of US$45 million. TRADE X will use the new growth capital for strategic acquisitions, and to expand its cross-border platform for pre-owned vehicle trading to car dealers, fleet, rental and mobility solution providers, as well as importers and exporters across North America, Europe, Asia, Africa and the Middle East.
TRADE X simplifies the process of buying and selling pre-owned vehicles internationally via its platform, accessible 24/7 via mobile, tablet or desktop. The platform handles all processes, procedures and documentation to ensure each transaction is compliant, insured and monitored from start to finish. The fully integrated platform is powered by TRADE X's proprietary 'Brain' technology, using machine learning and artificial intelligence to enhance the user experience.
Users can search for and request specific vehicles, view global pricing analytics, post vehicles for sale, assess economic viability, leverage arbitrage opportunities, obtain trade financing and transact in the currency of their choice. TRADE X handles all quality checks, international payments, transport, logistics, retitling, engaging registered importers, homologation, customs clearance and speedometer conversion across borders, effectively eliminating each complicated step previously being the responsibility of the buyer to handle manually. TRADE X pays sellers instantly in local currency, plus local tax, and all transactions are conducted securely and compliantly. Users must undergo a strict onboarding process to verify licenses, tax ID and compliance with commercial regulations, and only after all information is approved and verified are they granted access to the TRADE X authorized network. By standing as the trusted third-party escrow, TRADE X provides peace of mind and security for all users, whether they are trading within their own continent or overseas.
Led by auto industry veterans, Founder and CEO Ryan Davidson and Executive Vice President and COO Luciano Butera, TRADE X is set to disrupt cross-border trading in the pre-owned vehicle industry. For the 12 months ending December 31, 2020, TRADE X achieved gross vehicle sales of C$65 million. Gross vehicle sales for the six months to June 30, 2021, were C$77 million, generating positive EBITDA. With recent sales volume activity demonstrating strong momentum, sales are expected to trend higher in the second half of 2021.
"The overriding global need for a unified automotive trading platform has never been greater", said TRADE X's Ryan Davidson. "With this additional funding, we will expand our reach across multiple continents, connecting buyers and sellers beyond their borders to accelerate inventory turnover and boost profits substantially."
TRADE X's Luciano Butera commented: "There are multiple obstacles to international vehicle trade: Buyers and sellers often have no real way to find each other, buyers have no or very limited access to trade finance to pay sellers up front, and most importantly, there is a distinct lack of trust when doing business across borders. TRADE X solves all of these issues, providing an integrated, fully transparent and most importantly, compliant end-to-end global solution for pre-owned vehicle transactions."
The financing round was completed at a pre-money valuation of ~$C314 million (US$250 million). As part of the transaction, Aimia's CEO, Phil Mittleman, will join TRADE X's Board of Directors.
"We are very pleased to lead this funding round for TRADE X. Their proprietary TRADE X 'Brain' technology allows users to trade vehicles cross-border with greater ease, and less transactional risk than ever before," said Aimia's Phil Mittleman. "Already having achieved EBITDA profitability, TRADE X boasts a blue-chip client base, and is growing at a remarkable rate as it expands its market reach to other countries. We are proud to partner with TRADE X as they continue to grow their business organically, and through acquisitions."
TRADE X's new equity funding follows a round of capital secured in February 2021: a senior secured revolving line of credit of US$50 million, including an accordion to expand up to US$100 million provided by a global asset management firm with over US$100 billion in assets under management.