Online drive buy

Cars.com is exploring sale: source

Cars.com has hired JPMorgan Chase to explore strategic options including a possible sale of the company, The Post has learned.

The online car retailer earlier this month added two directors to its 11-member board who were nominated by activist investor Starboard Value.

With the activist firm, headed by Jeffrey Smith, in the boardroom, it looks unlikely this assignment is for anything but a sale, a source following the situation said.

“Hiring a banker means they think they can get $40 a share as that is what they want to sell for,” the source said.

Cars.com shares on Wednesday afternoon were trading at $25.19, up 3 percent, but after nypost.com reported exclusively about the JP Morgan hiring, the shares spiked, closing up 8.8 percent, at $26.59.

Cars.com said it doesn’t comment on speculation.

Possible suitors include buyout firm Apax Partners and pay-TV provider Cox Communications, which reportedly kicked the tires on the company two years ago before it went public.

Publishing giant Hearst, which owns Popular Mechanics, last month told trade publication DealReporter it might have interest in Cars.com if it were for sale. Cars.com says it attracts 19.4 million unique monthly visitors.

A second large private equity firm has recently started doing due diligence on the $1.8 billion market cap company in case it came up for sale, the source following the situation said.

Cars.com shares got hit earlier this month when Facebook said it was expanding its auto marketplace into Canada and the UK, following an announcement it was doing the same in the US.

Overall, Cars.com’s stock has been essentially flat since spinning off from local TV broadcaster Tegna last June at $25.34.

Cars.com’s revenue-sharing partnerships with publishers will expire in a few years, providing the company with the opportunity to keep a bigger slice of the revenue, according to sources.