Your Source for Up-To-Date News and Research on the Collision Repair Industry 

 

click here to subscribe to the FREE INSIGHT Editor's Desk News Alert Email

SUBSCRIBERS-ONLY
Today's News
INSIGHT This Month
INSIGHT Archives
Survey Center
Letter to the Editor

Business Tools
Subscription Information
CSI Reporting
Financial Analysis
IRS Audit Guide

Management/
Technical Info
Market Watch Rates
INSIGHT Inside this month's issue...

Feedback
Letter to the Editor

DriverShield to Acquire eAutoclaims

DriverShield will be the surviving entity and DriverShield shareholders will own at least 57 percent of the post-merger company, with EACC shareholders owning approximately 43 percent, subject to certain adjustments. According to the companies, the merger is contingent upon the completion of due diligence, the signing of a definitive agreement, regulatory review and shareholder approval by the shareholders of both companies. The closing is anticipated in the fourth calendar quarter 2002.

Barry Siegel, Chief Executive Officer of DriverShield, said, "This acquisition brings together the two market leaders and creates major opportunities for economies of scale that will immediately benefit all the customers and shareholders of both companies. We believe our sales volume will be at an annual run rate of nearly $50 million by the time the deal closes and should accelerate DriverShield's effort to reach profitability. There are virtually no overlaps in our customer bases and the combined resources of both companies will clearly create a value proposition unmatched by any other company in this industry, in terms of technology, proven shop network, operational functionality, and financial strength."

The combined companies currently have approximately 150 employees. It is contemplated that most of the senior executives of the combined companies will be headquartered at the new DriverShield headquarters located in Coral Springs, Florida. DriverShield also maintains an office in Long Island, New York. Under the supervision of Eric Seidel, the majority of the company's operations and employees will be located in Oldsmar, Florida and Columbia, South Carolina, where eAutoclaims is currently based. Barry Siegel will continue to serve as Chairman and CEO of the parent company.

Eric Seidel, President and CEO of eAutoclaims, will be President of the newly formed subsidiary, "The merger of eAutoclaims into DriverShield will create a technologically advanced company with a dominant market share and a strong balance sheet. We look forward to completing the transaction and executing our joint business plan," Seidel said.

DriverShield has agreed to advance eAutoclaims up to $1 million on a secured basis upon the signing of the definitive agreement. These funds will be used for growth and working capital. These advances that may be made to eAutoclaims will be converted into eAutoclaims common stock immediately prior to the closing of this transaction at the rate of $.30 per share of eAutoclaims common stock, thereby reducing the final percentage of stock ownership of DriverShield by eAutoclaims shareholders. eAutoclaims shall have the right to repay these advances prior to closing. The final balance of these advances will determine the percentage of DriverShield that eAutoclaims shareholders will be receiving at closing. It is presently anticipated that eAutoclaims shareholder's ownership of DriverShield should eventually at closing be between 33-43 percent.

DriverShield will continue to trade under the trading symbol DRVR on the Nasdaq SmallCap Market. The customer base for the combined company includes auto insurance industry leaders such as, Royal and SunAlliance and The St. Paul Insurance Company.

DriverShield has two other operating subsidiaries, including DriverShield ADS, which provides auto discounts services to affinity groups and financial institutions, and a newly formed operating subsidiary that will be formally announced shortly.

DriverShield, founded in 1983, provides Internet-based collision repair and claims management services for auto insurance companies and offers automotive discounts and services programs to members of affinity groups, primarily through financial institutions and membership organizations, serving the needs of approximately one million drivers.

eAutoclaims is a business services company that provides the insurance industry with claims management services through both ASP and integrated outsourcing solutions.

©2002 Collision Repair Industry INSIGHT
All Rights Reserved

FEATURED
LINKS:

INSIGHT Supports the NABC!
Do You?