Autobytel.com Plans Stock Offering to Raise $72 Million

Autobytel.com Inc., which operates a Web site for purchasing new and used vehicles, has revved up plans for an initial stock offering more than 1 1/2 years after canceling earlier plans.

The Irvine-based company will seek to raise about $72 million by selling 4.5 million shares to new investors for an estimated $16 per share, according to a report filed Friday with the Securities and Exchange Commission.

At that price, the company would have a market value of about $285.7 million, based on about 17.9 million shares outstanding after the stock sale.

The company initially filed plans to go public in January 1997, estimating it would raise as much as $44 million by selling 4 million shares for $9.50 to $11 per share. At the time, the company was known as Auto-By-Tel Corp. It postponed the offering in April 1997, citing “unfavorable stock market conditions.”

Since then, though, Internet-related IPOs have won a gravity-defying reputation as market high-fliers. On Friday, for example, shares of MarketWatch.com Inc., a financial news Web site, soared to as much as $130 in the first day of trading after an initial offering at $17 per share. At day’s end, MarketWatch shares closed at $97.50.

“The market has changed” since Autobytel.com’s initial filing, said David Menlow, president of Millburn, N.J.-based IPO Financial Network. “Then, the Internet was still emerging. Now it has made believers of a number of people.

“Investors are looking for a new concept and a new technology, so if they get an inkling that Autobytel.com represents one of those two areas, then it will be an even larger draw.”

Autobytel.com, founded by former Southern California car dealer Peter Ellis, operates a Web site that lets consumers get information on cars and light trucks, and shop for vehicles and financing from their homes. The Internet services are free to consumers. Autobytel.com makes money from auto dealerships that pay to be part of its referral service.

The company said it would use proceeds from the stock sale for advertising, to develop its Web site, and to offer new products and services. Autobytel.com itself will offer 3.5 million shares in the offering, and existing shareholders will sell 1 million shares.

Since April 1997, when the company abandoned its plans to go public, Autobytel.com’s dealer network has more than doubled to 2,718 paying dealers, up from 1,206, according to regulatory filings. Autobytel.com has also switched to a new underwriting group that includes BT Alex. Brown, Lehman Brothers, and Paine Webber Inc.

The market for new and used vehicles was more than $670 billion in 1997, representing the sale of more than 50 million cars and trucks, according to estimates provided in the filing. Autobytel.com--which also markets car insurance over its Web site--hopes to benefit as online shopping takes hold.

Autobytel.com had net losses of $15.5 million in the nine months ended Sept. 30, compared with net losses of $12.7 million in the year-earlier period. The company had revenue of $16.5 million in the first nine months of 1998, compared with revenue of $10.7 million in the first nine months of 1997.

Founder Ellis holds 4 million Autobytel.com shares, or a 28% percent stake, making him the largest stockholder before the IPO.

Autobytel.com plans to have its shares trade on the Nasdaq Stock Market under the symbol ABTL.