Warburg Pincus Provides Additional Capital to the Cobalt Group to Fund Continued Growth
27 June 2000
Warburg Pincus Provides Additional Capital to the Cobalt Group to Fund Continued Growth
SEATTLE--June 27, 2000--Investment for Expansion and Drive to Profitability
Strengthening its ability to meet the rising demand for Internet marketing and e-commerce services by the automotive industry, The Cobalt Group announced today that it has secured a commitment for $15 million in private equity from Warburg, Pincus Equity Partners, L.P.
Warburg Pincus, an early investor in The Cobalt Group, is joined by First Analysis Venture Capital, also an early investor in Cobalt, and another institutional investor. The common stock investment will allow Cobalt's management team to focus on accelerating the company's sales and product development momentum.
"The Cobalt Group is in a very strong position to lead the automotive industry into the Internet age," said Warburg Pincus managing director, Joe Landy. "We want Cobalt's management team to focus all of its energy on expanding the company's market share and deepening the company's service offerings, without any distraction from fundraising."
"The continued support of Warburg Pincus and First Analysis allows us to concentrate on helping the nation's leading car dealers use the Internet to expand their businesses, improve their customers' experience and eliminate inefficiencies in their supply chains," said Cobalt president and CEO, John Holt. "We have the resources to pursue a number of significant initiatives that will allow us to further expand our MotorPlace.com offerings and help us meet the growing demand for our core dealer Web site products and services."
"Closing on this investment facility will give us more cash on hand than at any time since our initial public offering, allowing us to make necessary investments to continue building our infrastructure, strengthening our customer service capabilities and increasing our product development efforts," Holt added. "These investments will help us drive the company towards profitability."
The commitment is structured as an option, which may be exercised at the sole discretion of Cobalt at any time between September 14, 2000 and November 13, 2000. Closing of the funding will be subject to customary closing conditions and regulatory approvals. As a part of the financing, Cobalt has issued the investors warrants to purchase up to 693,983 shares of Cobalt common stock at $6.86 per share.
About The Cobalt Group
The Cobalt Group(TM) , based in Seattle, is a leading provider of Internet-based products and services for the automotive industry. Cobalt helps dealers, dealer groups and automobile manufacturers harness the power of the Internet to realize new efficiencies, win new prospects and better serve their customers.
With approximately 6,000 dealer Web site clients, over 10,000 dealers using its parts locating system, and relationships with 16 automotive manufacturers and more than 50 of the 100 largest dealer groups in the United States, Cobalt is one of the leading technology companies serving the automotive industry. Cobalt operates MotorPlace.com(TM) (www.motorplace.com), a business-to-business vertical portal for the automotive industry; DealerNet(R) (www.dealernet.com), one of the best-known automotive destination sites on the Web; and PartsVoice(R) (www.partsvoice.com), a leading OEM auto parts locating and data management service. The Cobalt Group also owns IntegraLink Corporation, the auto industry's premier provider of advanced data extraction and reporting services.
Cobalt offers Web site services that are endorsed by the National Automobile Dealers Association.
For more information, please visit The Cobalt Group at www.cobaltgroup.com.
About Warburg Pincus
Warburg, Pincus Equity Partners, L.P. (WPEP) is a private equity fund initially capitalized at $5 billion in 1998. WPEP is managed by E.M. Warburg, Pincus & Co., LLC, a major global equity investment firm that has invested more than $9 billion in nearly 400 companies since 1971. The firm has considerable experience in funding software companies and Internet start-ups. Its past and present portfolio of investments includes Internet and technology companies such as BEA Systems, Covad Communications, StarMedia, Ventro, and EarthWeb. More information is available at www.warburgpincus.com.
About First Analysis Venture Capital
First Analysis Venture Capital (www.firstanalysisvc.com) is one of the largest early-stage venture capital firms in the United States. With a total of 10 funds raised, FAVC has funded over 150 successful companies, providing the infrastructure for an enhanced business-to-business marketplace. First Analysis Venture Capital plays an active role in developing and scaling early-stage companies by providing entrepreneurs with assistance in corporate development and strategy, business development and alliances, as well as financing events.