Cars.com has agreed to acquire Dealer Inspire and Launch Digital Marketing, adding a range of digital solutions that should appeal to its 20,000-plus dealer customers. Photo by Tony Webster via Flickr
CHICAGO — Cars.com Inc. announced it has entered into a definitive agreement to acquire privately held Dealer Inspire and Launch Digital Marketing for $165 million in cash at closing with potential additional consideration based on future performance.
Cars.com will supplement Dealer Inspire’s and LDM’s sales of innovative dealer technologies by integrating and distributing relevant digital solutions through the company’s sales network for the benefit of its more than 20,000 dealer customers nationwide, according to Cars.com President and CEO Alex Vetter.
“Cars.com is an enabler to the retail dealer system, and with the acquisition of these innovative technology companies, we are well positioned to drive digital dealer solutions forward by providing the most comprehensive set of solutions for dealers to generate sales and efficiencies,” Vetter said. “The acquisition of Dealer Inspire and LDM aligns with our strategy of integrating new capabilities and additional talent to accelerate organic growth, strengthen the retail experience, deepen dealer connections and improve clarity of attribution while generating additional cash flow and enhancing shareholder value.”
Dealer Inspire is best known for providing progressive dealer websites, digital retailing and messaging platform products. LDM provides digital automotive marketing services, including paid, organic, social and creative services.
“I’m proud of what Dealer Inspire and LDM have built in the last few years, but we are not even close to reaching our potential,” said Joe Chura, co-founder and CEO of both acquired companies. “Cars.com provides us the data to enhance the intelligence of our current and future product offerings, and a much larger distribution than we have today. Cars.com also shares our mission of innovation and dealer advocacy and together we can drive our industry forward.”
Dealer Inspire and LDM generated revenues of $41 million and adjusted EBITDA of $4 million in 2017 and have 1,700 customers serviced by 400 employees. Upon closing of the transaction, Dealer Inspire and LDM’s top management will join Cars.com and continue to lead these businesses, all according to the announcement.