ADP Dealer Services Group is planning to buy Cobalt Group Inc.
According to Dealer Communications – Friday July 9 will be the announcement of ADP Dealer Services plan to purchase Cobalt Group Inc.
Apparently discussions have been ongoing for nearly two years between ADP and Cobalt’s primary investor Warbug Pincus. The acquisition is expected to close sometime in the third quarter.
As of right now, there is no word on the sale price, though Cobalt is generating an estimated $250 – $270 million in revenue. According to Dealer Communications ADP could be paying in the neighborhood of $350 – $400 million.
This will be the second major dealer website provider purchase since 2006, when ADP bought BZ Results. The article also go on to say…
ADP plans to keep both brands separate with Cobalt maintaining its Tier One and Tier Two relationships and BZ Results selling directly to the Tier Three/ dealership level.
Cobalt CEO and founder John Holt continue on as vice president of ADP’s Digital Marketing Group which already consists of Cobalt, Dealix and BZ Results.
Here is a link to the entire article on Dealer Communications website – Nice Job Cliff Banks on this breaking news!
What do you think of this purchase?
Does it make sense for ADP to make such a purchase and what exactly do you think they will get from this?