Cox Automotive closes $4 billion DealerTrack acquisitition

Cox Automotive President Sandy Schwartz

Cox Automotive President Sandy Schwartz

The automotive arm of Atlanta-based Cox Enterprises said Thursday it has closed on its $4 billion acquisition of Dealertrack Technologies, a company that provides software, marketing and e-commerce services for car dealers.

The all-cash deal, the largest in Cox’s history, adds to Cox Automotive’s core businesses, including online marketplace AutoTrader, used car auction firm Manheim and valuation company Kelley Blue Book.

Under the deal, the publicly traded Dealertrack becomes a private subsidiary under the Cox Automotive division.

“These are very complementary companies. There’s very little overlap,” said Sandy Schwartz, president of Cox Automotive.

Cox Automotive, with 24,000 employees and annual revenue of about $5 billion in 2014, is the second-largest division of Cox Enterprises, which also owns The Atlanta Journal-Constitution.

With about 5,000 employees, Dealertrack’s various software and services connect dealers with lenders, manufacturers and after-market parts companies. Its subsidiary, Dealer.com, also provides marketing services and produces websites for dealerships.

Mark O’Neil, Dealertrack’s chairman and CEO, will take on a senior executive role in Cox Automotive.

Logo of Cox Automotive

Logo of Cox Automotive

To satisfy federal regulators and close the transaction, Cox agreed to sell Dealertrack’s Inventory+ business line to DealerSocket for about $55 million.

The U.S. Department of Justice’s Antitrust Division challenged Cox Automotive’s purchase of Dealertrack this week on grounds that Cox would dominate the car dealer inventory management software business. The proposed settlement, which the Justice Department filed this week in conjunction with the lawsuit, would help preserve competition, the government said.

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