Dealership software company DealerSocket has signed a definitive agreement to acquire dealership management system provider Auto/Mate, the companies confirmed Monday.
Terms of the deal were not disclosed. The two companies will operate independently until a deal is finalized. Upon close, the combined company would have more than 9,000 dealership customers.
Auto/Mate, of Albany, N.Y., was targeted for acquisition by DMS giant CDK Global in 2017, but the deal was scrapped in March 2018 after the Federal Trade Commission filed a complaint, saying the merger would violate U.S. antitrust laws.
Auto/Mate is estimated to be about fourth in market share for DMS companies in the U.S., behind CDK Global, Reynolds and Reynolds, and Cox Automotive’s Dealertrack, respectively.
In October 2017, DealerSocket's then-new CEO Sejal Pietrzak told Automotive News she didn't yet know whether the company would pursue offering a DMS product to franchised dealerships.
"I know that our strategy is to be a platform player. How we go after the DMS space — buy, build or partner — is yet to be confirmed," Pietrzak said then. "There's merit in each one of those opportunities. That is something we continue to look at."
In a statement Monday, Pietrzak implied that a deal with Auto/Mate had been in the works for some time. “For a long time, DealerSocket has believed that combining our companies could offer dealers a much-needed new choice for a full platform solution,” Pietrzak said. She added that the two companies anticipate “tremendous opportunities for innovation” while focusing on customer service.
Auto/Mate CEO Mike Esposito said in a statement that the two companies have many joint customers, and have been partners for years.
He added: “With the scale this deal brings and the investment we will receive being part of DealerSocket, we will be able to offer our customers and the broader market a seamless platform that will further advance what is possible for dealerships.”