Print
Respond to Editor
ReprintsF&I vendor's new owner retains CEO, studies expansion
Automotive News -- January 11, 2012 - 10:53 am ET
 |
Ryan Clark, managing director of private-equity firm Genstar Capital, which owns Innovative Aftermarket Systems: "We identified auto warranty as an attractive market in the underwriting area." |
Texas F&I vendor Innovative Aftermarket Systems may have a new owner, but for now, at least, not much will change.
"If it ain't broke, don't fix it," says Ryan Clark, managing director of private-equity firm Genstar Capital in San Francisco, which announced late last year that it had acquired IAS. The terms of the deal were not disclosed.
IAS, based in Austin, markets, administers and underwrites GAP policies, anti-theft protection, tire-and-wheel coverage, windshield repair and replacement, key replacement, paintless dent repair, and appearance protection policies. It also offers reinsurance programs.
Clark spoke with Special Correspondent Jim Henry by phone last week.
Why the investment in IAS?
We identified auto warranty as an attractive market in the underwriting area.
What are your plans for IAS?
To stick to the status quo. ... The management team there (led by CEO Bob Corbin) is very strong. The idea is for them to keep doing what they're doing. "If it ain't broke, don't fix it," that sort of thing. They are generating great underwriting profits. This deal was not catalyzed by any need for a big shift.
Having said that, the company had a merger-and-acquisition strategy that got put on hold because of the recession and the credit crisis, where they were looking at buying other warranty administrators, looking at new areas, new products. We are going to revisit that expansion strategy.
Is it fair to say the deal isn't contingent on the expansion, but you're studying it?
That's fair to say.
Is this your first automotive investment?
This isn't quite our first in the automotive space. We also have a company called Confie Seguros, which does nonstandard auto insurance. ... Because we manage a whole portfolio of different businesses, we typically don't make multiple investments in the same space, to stay diversified.
Confie Seguros is property-and-casualty auto insurance, right? Not aftermarket products that consumers can buy at a dealership.
Actually, Confie Seguros is partly a dealer-focused business. But it doesn't do products like tire and wheel, key replacement -- that sort of thing. It's nonstandard auto insurance.
Doesn't somebody at the dealership need a license to sell that type of insurance?
The dealers can't sell it themselves; we send an agent over to the dealership to do it.
Are those franchised, new-car dealers that sell used cars?
The dealers in the channel for that are mainly franchised, new-car dealers. By law in just about every state, the customer has to have insurance in order to buy the car.
