AutoCanada closes sale of Kia of Lincolnwood

Executive Summary

• AutoCanada Inc. completed the sale of its Kia of Lincolnwood dealership in Illinois, advancing its previously announced strategy to exit U.S. operations and strengthen its balance sheet.
• The transaction generated approximately $13.4 million in cash proceeds, which will be applied to reduce the company's outstanding revolving credit facility balance.
• AutoCanada secured a covenant amendment from its lending syndicate, increasing the maximum permitted financed debt to bank EBITDA ratio from 4.0x to 4.5x through June 2026 to provide financial flexibility during the ongoing U.S. divestiture process.

Key Details

• Transaction Structure & Consideration: Completed sale of Kia of Lincolnwood (Lincolnwood, Ill.), comprising $7.1 million for goodwill and fixed assets (excluding inventory and net working capital) and $6.3 million for real estate.
• Total Proceeds & Use of Funds: Approximately $13.4 million in cash received; net proceeds directed toward reducing the outstanding balance of the revolving credit facility.
• Asset Financials: For the 12 months ended Dec. 31, 2025, the dealership generated ~$53.0 million in sales (2024: $58.0 million) and incurred a net loss of $1.6 million (2024: $2.0 million net loss).
• U.S. Exit Progress: Total gross proceeds net of working capital from U.S. asset sales since the segment's reclassification as discontinued operations (end of 2024) now stand at ~$62.4 million. The company maintains its target range of $115 million to $130 million in total gross proceeds.
• U.S. Segment Performance: The U.S. portfolio (11 franchised dealerships across 8 brands in Illinois) recorded a net loss from discontinued operations of $103.4 million in 2024 and sold approximately 8,000 retail vehicles in 2025.
• Credit Facility Amendment: Lending syndicate consented to amend the financed debt to bank EBITDA covenant, raising the maximum permitted ratio from 4.0 times to 4.5 times through June 30, 2026.
• Strategic Context: The disposition supports the company's broader balance sheet strengthening initiative and continued execution of the U.S. operations exit plan.