HOFFMAN ESTATES, In poor health., Nov. 30, 2020 (GLOBE NEWSWIRE) — CDK World, Inc. (Nasdaq:CDK) (the “Firm” or “CDK”), a number one supplier of supplier administration techniques (“DMS”) and built-in info expertise options to the automotive retailing and adjoining industries, introduced at this time the execution of a definitive settlement to promote its CDK Worldwide enterprise phase (“CDKI”) to Francisco Companions for $1.45 billion. The acquisition value represents roughly 15 occasions CDKI’s LTM adjusted EBITDA(1) together with bills for the standalone enterprise. CDK expects the transaction to be accomplished throughout the third quarter of its fiscal 12 months 2021, topic to customary closing circumstances and regulatory approval.
“I’m excited to announce this necessary milestone for CDK. With this transaction, we are able to now concentrate on executing the subsequent part of our progress journey and highlight our consideration on our North America enterprise,” stated Brian Krzanich, CDK president and chief govt officer. “CDK has made vital progress over the past two years in strengthening and increasing our core enterprise to be customer-centric and a pacesetter in expertise for our sellers, OEMs and companions and now we have seen the optimistic outcomes of our funding efforts. We are actually effectively positioned to increase our actions and create new income streams with even stronger progress prospects.”
“Whereas we consider the Worldwide enterprise is a superb asset and are very happy with the compelling valuation, it largely operated independently, with particular expertise, gross sales and operations tailor-made to the Worldwide markets. The sale of this enterprise strengthens our steadiness sheet and supplies vital monetary flexibility in help of our objectives to drive worth and to speed up progress in our North America enterprise,” stated Joe Tautges, CDK chief working officer and interim chief monetary officer. “As our monitor document signifies, we are going to use a considerate returns-based method to allocating capital and can present an replace to our deliberate use of proceeds on the launch of our Q2 fiscal 2021 earnings outcomes.”
CDK will use the proceeds of the transaction for common company functions, together with the pay down of debt to strengthen the steadiness sheet.
Primarily based on the execution of this settlement to promote, the CDKI phase can be labeled as discontinued operations within the second quarter of fiscal 2021. In consequence, the corporate introduced that it’s withdrawing its beforehand offered annual consolidated steerage estimates for fiscal 12 months 2021. CDK can be updating its FY 2021 steerage to replicate persevering with operations within the coming weeks as soon as the preparation of the discontinued operations reporting is full.
Extra info is out there in our accompanying presentation, which is out there on the CDK Investor Relations web site at investors.cdkglobal.com. Additional particulars concerning the definitive gross sales settlement will be discovered on Type 8-Okay filed with the Securities and Trade Fee on November 30, 2020.
Credit score Suisse is serving as monetary advisors for the transaction, with Mayer Brown LLP performing as authorized advisor.
(1)LTM Adjusted EBITDA consists of estimated bills for the standalone enterprise for the twelve months ended September 30, 2020.
About CDK World
With $2 billion in revenues, CDK World (NASDAQ:CDK) is a number one world supplier of built-in info expertise options to the automotive retail and adjoining industries. Centered on enabling end-to-end automotive commerce, CDK World supplies options to sellers in additional than 100 nations world wide, serving roughly 30,000 retail areas and most automotive producers. CDK options automate and combine all elements of the dealership and shopping for course of, together with the acquisition, sale, financing, insuring, elements provide, restore and upkeep of autos. Go to cdkglobal.com.
About Francisco Companions
Francisco Companions is a number one world funding agency that makes a speciality of partnering with expertise and technology-enabled companies. Since its launch over 20 years in the past, Francisco Companions has raised over $24 billion in dedicated capital and invested in additional than 300 expertise firms, making it one of the vital energetic and longstanding buyers within the expertise trade. The agency invests in alternatives the place its deep sectoral information and operational experience can assist firms notice their full potential. For extra info on Francisco Companions, please go to franciscopartners.com.
Protected Harbor for Ahead-Trying Statements
This press launch accommodates “forward-looking statements” inside the that means of the Non-public Securities Litigation Reform Act of 1995. All statements, apart from statements of historic truth, together with: statements concerning the proposed transaction; the Firm’s enterprise outlook, together with the Firm’s GAAP and adjusted fiscal 2021 steerage; different plans; goals; forecasts; objectives; beliefs; enterprise methods; future occasions; enterprise circumstances; outcomes of operations; monetary place and enterprise outlook and traits; and different info, could also be forward-looking statements. Phrases comparable to “may,” “will,” “might,” “might,” “ought to,” “estimates,” “expects,” “continues,” “contemplates,” “anticipates,” “tasks,” “plans,” “potential,” “predicts,” “intends,” “believes,” “forecasts,” “future,” “assumes,” and variations of such phrases or comparable expressions are supposed to determine forward-looking statements. These statements are primarily based on administration’s expectations and assumptions and are topic to dangers and uncertainties that will trigger precise outcomes to vary materially from these expressed, or implied by, these forward-looking statements.
Components that would trigger precise outcomes to vary materially from these contemplated by the forward-looking statements embrace: the timing of or failure to acquire vital regulatory approvals or to fulfill any of the opposite circumstances to the transaction described herein, the corporate’s means to realize the supposed advantages of the transaction and the anticipated prices of the transaction; the Firm’s expectations concerning the potential impacts on the Firm’s enterprise of the outbreak of the COVID-19 pandemic; the Firm’s success in acquiring, retaining and promoting further providers to clients; the pricing of the Firm’s services; general market and financial circumstances, together with rate of interest and international foreign money traits, and expertise traits; opposed world financial circumstances and credit score markets and volatility within the nations wherein we do enterprise; auto gross sales and associated trade modifications; aggressive circumstances; modifications in regulation; modifications in expertise, safety breaches, interruptions, failures and different errors involving the Firm’s techniques; availability of expert technical workers/labor/personnel; the affect of latest acquisitions and divestitures; employment and wage ranges; availability of capital for the cost of debt service obligations or dividends or the repurchase of shares; any modifications to the Firm’s credit score scores and the affect of such modifications on financing prices, charges, phrases, debt service obligations, entry to capital market and dealing capital wants; the affect of the Firm’s indebtedness, entry to money and financing, and talent to safe financing, or financing at engaging charges; the onset of or developments in litigation involving contract, mental property, competitors, shareholder, and different issues, and governmental investigations; and the flexibility of the Firm’s vital stockholders and their associates to considerably affect the Firm’s choices or trigger it to incur vital prices.
There could also be different elements that will trigger the Firm’s precise outcomes, efficiency or achievements to vary materially from these expressed in, or implied by, the forward-looking statements. The Firm provides no assurances that any of the occasions anticipated by the forward-looking statements will happen or, if any of them do, what affect they may have on its outcomes of operations and monetary situation. You need to rigorously learn the elements described within the Firm’s experiences filed with the Securities and Trade Fee (“SEC”), together with these mentioned beneath “Half I, Merchandise 1A. Danger Components” in its most up-to-date Annual Report on Type 10-Okay and its most up-to-date Quarterly Report on Type 10-Q for an outline of sure dangers that would, amongst different issues, trigger the Firm’s precise outcomes to vary from any forward-looking statements contained herein. These filings will be discovered on the Firm’s web site at investors.cdkglobal.com and the SEC’s web site at www.sec.gov.
All forward-looking statements communicate solely as of the date of this press launch even when subsequently made obtainable by the Firm on its web site or in any other case. The Firm disclaims any obligation to replace or revise any forward-looking statements that could be made to replicate new info or future occasions or circumstances that come up after the date made or to replicate the incidence of unanticipated occasions, apart from as required by legislation.
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