Cars.com acquired two digital startups Wednesday for $165 million in cash.
Chicago-based Cars.com (NYSE: CARS) announced it has bought both Dealer Inspire and Launch Digital Marketing, two local companies that provide digital tools to automotive dealers.
Both Dealer Inspire and LDM are run by Joe Chura and share an office space in Naperville. Dealer Inspire, launched in 2013, offers website building tools to automotive dealers. LDM provides website design and social media management services, and it launched in 2011.
Dealer Inspire and LDM generated $41 million in revenue in 2017, according to a news release. Dealer Inspire and LDM's management will join Cars.com and continue to lead the businesses, Cars.com said.
"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," Chura said in a statement. "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 said the acquisitions will allow it to offer more digital tools to auto dealers through its online marketplace.
Cars.com is paying $165 million for both businesses, but the price could increase by $40 million if the companies hit certain performance metrics.
The acquisition is expected to close later this month.
