AutoTrader.com announced a definitive agreement to acquire VinSolutions on May 18, 2011 and announced the closing on June 16, 2011. The deal added CRM, internet lead management, inventory tools, dealer websites, sales management, desking and targeted marketing software to AutoTrader’s dealer-technology portfolio.[1][2]
Transaction ledger
| Item | Value |
|---|---|
| Agreement announced | May 18, 2011[1] |
| Closing announced | June 16, 2011[2] |
| Cash paid at acquisition | $134.6 million[3] |
| Maximum earn-out | $15.0 million[3] |
| Earn-out paid in 2012 | $13.0 million[3] |
| Working-capital settlement received | $1.2 million[4] |
| Net cash amount after settlement | $133.4 million[4] |
| Earn-out treated as additional purchase price | $10.6 million[4] |
| Final reported purchase price | $144.1 million[4] |
What AutoTrader bought
AutoTrader’s May 2011 announcement described VinSolutions as an end-to-end dealer platform covering customer relationship management, internet lead management, inventory management, dealer websites, sales management, desking, social media and direct targeted marketing.[1] The June closing announcement repeated that product scope and confirmed VinSolutions had become an AutoTrader.com subsidiary.[2]
Exact transaction economics
AutoTrader’s 2012 SEC filing reported that the company acquired VinSolutions for $134.6 million in cash. The purchase agreement allowed up to $15.0 million in additional earn-out consideration, and AutoTrader paid $13.0 million in 2012 to settle that earn-out.[3]
A later amended filing reconciled the final economics. AutoTrader received a $1.2 million working-capital settlement, reducing the net cash amount to $133.4 million. Of the $13.0 million earn-out payment, $10.6 million was treated as additional purchase price, producing a final reported purchase price of $144.1 million.[4]
Why VinSolutions fit AutoTrader’s software strategy
The acquisition was part of AutoTrader’s rapid expansion into dealer software. By June 30, 2012, AutoTrader reported more than 21,000 subscribing dealers, while only about 5,500 subscribed to recently acquired vAuto, VinSolutions and HomeNet products or to more than one software solution.[4]
AutoTrader explicitly identified cross-selling those software products into its existing dealer base as a growth opportunity. That documented strategy explains why VinSolutions mattered beyond its standalone revenue: the acquisition gave AutoTrader additional products it could sell through established dealer relationships.[4]
Where the deal fits in dealer-technology consolidation
VinSolutions joined an AutoTrader portfolio that also included software and data assets such as vAuto, HomeNet Automotive and Kelley Blue Book. The practical result was a broader set of dealer-facing products spanning marketplace advertising, inventory, valuation, CRM, lead management, websites and sales workflow.
For dealerships evaluating current systems, the most relevant historical point is concrete: ownership of dealer software can change, and acquisitions can affect product combinations, integrations and commercial relationships. Current CRM evaluation should therefore include data access, integrations and transition risk alongside features; see ADM’s automotive CRM guide for dealerships.
Contemporaneous dealer-industry reaction
DealerRefresh covered the acquisition on May 18, 2011, providing a dealer-industry view from the day the agreement was announced.[5] That source is useful for period reaction; the transaction dates, product scope and economics are better established by AutoTrader’s releases and SEC filings.
References
- AutoTrader.com, “AutoTrader.com Agrees to Acquire VinSolutions,” May 18, 2011.
- AutoTrader.com, “AutoTrader.com Announces Closing of VinSolutions Acquisition,” June 16, 2011.
- AutoTrader Group, Inc., Form S-1, filed June 15, 2012.
- AutoTrader Group, Inc., amended Form S-1, 2012.
- DealerRefresh, contemporary dealer-industry coverage, May 18, 2011.