Mitch Fadel, chief executive officer at Rent-A-Center, said in a press release on Monday (Dec. 21) that Acima founder Aaron Allred and his team have created a leading virtual LTO solution for retailers and consumers.
“We all share a common vision to expand the virtual LTO offering across a broader set of retail partners and to meet the needs of more customers through an integrated omnichannel strategy. Acima will help us strengthen our organization, accelerate growth and increase our virtual partner base, allowing us to better serve more consumers with the flexibility of LTO,” Fadel said.
He added that with Acima, Rent-A-Center will be in a position for accelerated growth and “increase our virtual partner base, allowing us to better serve more consumers with the flexibility of LTO.”
The deal is $1.273 billion in cash and approximately 10.8 million shares of Rent-A-Center common stock currently valued at $377 million. The transaction is expected to close in the first half of 2021.
Founded in 2013 in Salt Lake City, Utah, Acima operates in over 15,000 retail partner locations and eCommerce platforms. Annual revenues have grown from $97 million in 2016 to an anticipated $1.25 billion in 2020. About $225 million in adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is expected for 2020.
Salt Lake City will continue to be Acima’s headquarters, and the company will incorporate Rent-A-Center’s complementary Preferred Dynamix platform to create a frictionless LTO experience for consumers and retail partners.
Upon the closing of the transaction, the current Acima management team will report to Preferred Dynamix Executive Vice President Jason Hogg, and the combined business will be reported in the Preferred Lease segment.
Earlier this year, rent-to-own (RTO) companies Rent-A-Center, Buddy’s and Aaron’s settled an antitrust case. The Federal Trade Commission (FTC) alleged the companies cut deals that left customers with limited choices.