8-KMaterial AgreementsExhibits & Filings

CARVANA CO. 8-K Report, Material Agreement (Apr 2, 2019)

Filed April 2, 2019For Securities:CVNA

Summary

Carvana Co. (CVNA) filed an 8-K on April 1, 2019, reporting on a significant securitization transaction completed on March 29, 2019. A subsidiary of Carvana sold $350.0 million in principal balances of finance receivables to a securitization trust. These receivables will serve as collateral for asset-backed securities issued by the trust. This transaction is crucial as it represents Carvana's ability to access capital markets by securitizing its finance receivables, a key component of its business model for funding vehicle sales.

Key Highlights

  • 1Carvana Co. subsidiary entered into a material definitive agreement on March 29, 2019.
  • 2The agreement is a Transfer Agreement related to a securitization transaction.
  • 3A securitization trust purchased $350.0 million in principal balances of finance receivables.
  • 4These finance receivables will collateralize asset-backed securities issued by the trust.
  • 5This demonstrates Carvana's ongoing access to debt financing through securitization.
  • 6The transaction is a core part of Carvana's strategy to fund its growing loan portfolio.
  • 7The filing includes the Transfer Agreement as an exhibit.

Frequently Asked Questions

The Transfer Agreement is part of a securitization transaction where Carvana's subsidiary sold $350.0 million of finance receivables to a trust. These receivables will be used to back asset-backed securities issued by the trust, providing Carvana with a funding mechanism.

This transaction allows Carvana to access capital by selling its finance receivables. This is essential for funding its rapidly expanding loan portfolio and supporting its growth in online used car sales.

Finance receivables, in this context, are likely installment contracts or loans provided to customers who purchase vehicles from Carvana and finance the purchase through Carvana's lending services.

While this specific filing reports on a transaction on March 29, 2019, Carvana has a history of utilizing securitization to fund its operations, as it is a core part of their business model for managing its loan origination and financing activities.