Dealership marketing company AutoWeb Inc., after this spring revealing doubts about its ability to continue as a going concern, said Monday it has agreed to be acquired by One Planet Group, a self-described hybrid technology firm led by one of AutoWeb's founders.
One Planet Group will pay AutoWeb shareholders 39 cents per share, according to a regulatory filing containing the transaction agreement. The filing doesn't indicate the overall purchase price for AutoWeb but says the company has just more than 14 million outstanding shares. That would translate to a purchase price of nearly $5.5 million.
AutoWeb CEO Jared Rowe, 48, will leave the business after the transaction closes and will be paid $1.75 million in installments, with the payout to be completed by March 15. One Planet Group CEO Payam Zamani, 51, will replace him, according to a news release. AutoWeb, of Tampa, Fla., said it expected the deal to close by Sept. 16.
"Not many founders get the opportunity to return to a company that they helped create," Zamani said in a statement. "AutoWeb has been a pioneer in the online automotive industry and in many ways directly influenced its evolution. It is now time for the company to experience an evolution to prepare for the challenges and the opportunities in the automotive industry of tomorrow."
Zamani previously told Automotive News that he and his brother Frank co-founded AutoWeb, an online car-buying service, in 1994. Zamani, in an email to Automotive News, declined further comment about the deal.
AutoWeb's history is intertwined with that of Autobytel Inc., another 1990s online car-buying venture.
Pete Ellis founded Autobytel, which had its initial public offering in March 1999. In 2015, Autobytel acquired AutoWeb for its analytics capabilities. In 2017, Autobytel changed its corporate name to AutoWeb and its stock ticker from "ABTL" to "AUTO."
In May, AutoWeb announced its board of directors would explore strategic alternatives for the company — including a potential sale or restructuring — because "substantial doubt" existed about its ability to continue as a going concern.
At the time, AutoWeb said its cash and liquidity situation led management to make that determination after the company posted a net loss of $4.3 million for the first quarter. A special board committee was created to evaluate alternatives for the company, including obtaining new debt or equity funding; selling the company or assets; and restructuring, including through federal bankruptcy protection.
The board committee recommended the acquisition by One Planet Group, and AutoWeb's board of directors approved the transaction, according to the news release.
The acquisition will take the form of a two-step merger. One Planet Group will first issue a tender offer for issued and outstanding AutoWeb shares. That will be offered by Aug. 1, according to the release.
The company will then go forward with the second step, in which AutoWeb shares not tendered in the tender offer "would be converted into the right to receive the same cash price per share as stockholders who tendered in the tendered offer."
AutoWeb shares dropped 14 percent to 38 cents at the 4 p.m. close of trading Monday.