Cliff Banks - The Banks Report

Cox Completes Dealertrack Acquisition

October 1, 2015 — After four extensions and other delays resulting from stipulations from the Department of Justice, Cox Automotive completed the $4 billion acquisition of Dealertrack this morning. Cox is paying $63.25 per share of Dealertrack common stock which ceases trading today on the NASDAQ Global Market.

It is the biggest vendor acquisition in the automotive retail industry to date. As part of the deal, Dealertrack agreed to sell its Inventory+ solution to Dealersocket for $55 million, a deal that closed last night.

The Department of Justice also is requiring Cox to continue allowing the exchange of data between Inventory+ and other solutions that Cox owns. The data requirements also extend to Chrome Data Solutions, which Dealertrack has an interest in.

Earlier this morning Cox Automotive President Sandy Schwartz told TBR that the first move now is to communicate the vision to employees of the new joint company and then he and Dealertrack President Mark O’Neil will be visiting clients over the next couple of weeks.

The goal over the next few years will be to build out an end-to-end retail solution as the industry moves closer to an environment where the sales transaction takes place on line.

Another key piece is the data that Cox now has that will enable it to see and analyze what is happening in automotive retail from a shopping and buying perspective.

TBR will provide ongoing analysis of what the deal means for the industry overall.



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