America’s Car-Mart Completes Securitization Transaction Worth Over $200 Million

America’s Car-Mart, Inc. recently announced the successful completion of a significant securitization transaction. On January 31, 2025, affiliates of America’s Car-Mart finalized the transaction, which involved issuing and selling $150,770,000 aggregate principal amount of 5.38% Class A Asset Backed Notes and $49,230,000 aggregate principal amount of 7.87% Class B Asset Backed Notes. These notes were part of a private offering under ACM Auto Trust 2025-1, an indirect subsidiary of the company.

The Notes, collateralized by accounts receivable totaling $337,286,838 related to installment sales contracts from America’s Car-Mart’s operating subsidiaries, are obligations of ACM Auto Trust 2025-1 and not America’s Car-Mart or its affiliates. Net proceeds of approximately $198.5 million from the offering are aimed at repaying existing debt and funding collection and reserve accounts for note holders.

S&P Global Rating Agency has assigned ratings to the Notes, with the Class A Notes rated A (sf) and the Class B Notes rated BBB (sf).

To facilitate this transaction, Colonial Auto Finance, Inc., a wholly-owned subsidiary of America’s Car-Mart, sold customer receivable contracts to ACM Funding, LLC. The receivables were then transferred to the Issuer, with America’s Car-Mart, Inc. servicing the contracts, and Deutsche Bank National Trust Company acting as Trustee.

Interest and principal payments on the Notes, issued under an Indenture, will commence on February 20, 2025, with a maturity date of November 20, 2031. Initial purchasers include BMO Capital Markets Corp., MUFG Securities Americas Inc., and Atlas SP, with subsequent resale to qualified institutional buyers under Rule 144A.

Credit enhancement for the Notes includes over-collateralization, a reserve account, excess interest, and subordination of payments. The Servicer retains the right to purchase the receivables under certain conditions.

In the event of default, the Trustee may demand immediate payment of outstanding amounts. Events of default encompass various scenarios, including missed payments or specific bankruptcy-related events.

The press release issued on February 3, 2025, detailed the successful completion of the Securitization Transaction. Exhibits filed include the Indenture, Purchase Agreement, Sale and Servicing Agreement, and the press release.

This information was submitted in a Form 8-K filing to the Securities and Exchange Commission on February 5, 2025, by Vickie D. Judy, the Chief Financial Officer of America’s Car-Mart, Inc.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read America’s Car-Mart’s 8K filing here.

About America’s Car-Mart

America’s Car-Mart, Inc, through its subsidiaries, operates as an automotive retailer for the used car market in the United States. It primarily sells older model used vehicles and provides financing for its customers. The company was founded in 1981 and is headquartered in Rogers, Arkansas.