Cars.com to acquire auto finance technology company CreditIQ

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Dealership tech firm Cars.com has announced plans to acquire automotive financial technology firm CreditIQ in a $ 30 million deal.

Chicago-based Cars.com said Thursday that it plans to close the deal this month. The acquisition will be funded with cash, the company said, and includes the possibility of additional performance-based cash consideration of up to $ 50 million over three years.

Acquisition of CreditIQ will bring Cars.com into the auto finance market and expand the company’s reach beyond its current advertising and dealer technology markets, said Cars.com CEO Alex Vetter, in the press release.

“The acquisition of this scalable technology supports our vision to create frictionless omnichannel experiences and further develop the capabilities of our platform for buyers and sellers,” said Vetter.

CreditIQ, founded in 2014, offers technology for digital retail and finance, including online credit and loan approvals. The combination of Cars.com and CreditIQ will allow dealers to use CreditIQ’s platform with existing Cars.com products, including dealer websites, its Online Shopper digital retail tool, and its Marketplace. vehicle listings once it’s integrated, starting in the first quarter of 2022, Cars.com said.

“CreditIQ’s technology was created to help dealerships be more efficient and profitable,” CreditIQ CEO Bill Liatsis said in a statement.

Also on Thursday, Cars.com reported higher revenue in the third quarter which ended September 30 and reported a net profit after a net loss in the same quarter a year earlier.

The company had 19,029 dealer customers as of September 30, an increase of 899 from September 30, 2020 and an increase of 184 from June 30. the adoption of its digital products and the growth and retention of dealer customers.

Cars.com said it increased its operating expenses in the third quarter compared to the same period in 2020, when the company cut some expenses due to the pandemic. Cars.com said Thursday the increases reflected more typical spending levels and included higher marketing, product and technology and compensation spending.

Shares of Cars.com rose 1% to $ 13.42 in morning trading.

Q3 turnover: $ 156.6 million, up 8.4% from a year ago

Q3 net income: $ 2.4 million, compared to a net loss of $ 12.3 million a year earlier

Q3 Adjusted EBITDA: $ 45.8 million, down 6.6% from a year ago

Advice: Fourth quarter revenue, $ 157.5 million to $ 159.5 million

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