Cox Automotive To Buy DealerTrack for $4 Billion In Cash

It was announced this morning that Cox Automotive will acquire Dealertrack for $4 billion in cash for $63.25 per share. The deal should be finalized during the third quarter of this year. Cox Automotive already owns automotive companies such as Kelly Blue Book, Autotrader, vAuto, VinSolutions and Manheim. This latest addition represents a large push forward for the dealership management software side of the newly updated portfolio of Cox Automotive.

Sandy Schwartz, President of Cox Automotive, spoke about the merger in a statement. Speaking about this union between Dealertrack and Cox, Schwartz said, “This is a great investment in our customers and in the auto industry. We have long admired the Dealertrack team and its highly respected brands. Integrating our platforms will be a big step forward in our shared vision of providing open, cost-effective and efficient solutions for dealers, lenders, manufacturers and consumers. We look forward to working with Mark O’Neil and his team as Mark continues to lead the acquired businesses and as we continue to innovate for our customers.”

Mark O’Neil in turn echoed the sentiments expressed by Schwartz. In a press release issued by Dealertrack, O’Neil said, “I am confident that with Cox Automotive, we will fully unlock the potential of our combined brands and teams in the service of our clients. Dealertrack team members have been a critical element in the tremendous success our company has achieved, and I want to thank all of our team members as we move forward into this exciting new chapter of growth. I am extremely enthusiastic about our future with Cox Automotive.”

This deal doesn’t come with a financing condition as it is fully funded. The details of the funding for this deal include a $1.85 billion bank term loan arranged by Citigroup Global Markets Inc., a $750 million common equity investment from BDT Capital Partners and existing bank facility.