The Reynolds and Reynolds Co. and Universal Computer Systems Inc. today announced a definitive agreement to merge their two organizations to create a dealer services company.
The transaction is valued at $2.8 billion, including the assumption of the Reynolds debt.
Reynolds has a plant in Celina.
Under the terms of the agreement, holders of Reynolds' common stock will receive $40 per share in cash, according to a press release from the companies.
The transaction is subject to approval by Reynolds shareholders and regulatory clearances. Reynolds' board members Richard H. Grant III and Fin O'Neill, president and CEO, have agreed to vote their shares in favor of the transaction. The combined company will continue to be known as The Reynolds and Reynolds Company, with the products and services of both Reynolds and UCS marketed under the Reynolds brand. The UCS brand will be discontinued. Reynolds will continue to have headquarters and principal operations in Dayton.
Mercer County Community Development Director Larry Stelzer said from all indications it is going to be good news locally and for the corporation. "It will make them even stronger," he said.
Corporate headquarters officials told Stelzer they value their long history with the Mercer County community.
Reynolds was founded in Dayton as a business forms printing company in 1866. It began serving dealers in 1927 with standardized accounting forms. UCS was founded in Houston and provides fully integrated dealership management systems solutions to some of the largest dealerships in the United States.
Reynolds expects to schedule a special meeting of its shareholders during the fourth calendar quarter of 2006 to vote on the transaction.
The transaction is being financed by a combination of equity primarily from a group of investors led by the Goldman Sachs Capital Partners, Vista Equity Partners, and others, with debt provided by Deutsche Bank and Credit Suisse.
JPMorgan served as financial adviser to Reynolds and Reynolds, and Wachtell Lipton Rosen and Katz served as its legal adviser. UCS was advised by Credit Suisse, and Skadden, Arps, Slate, Meagher & Flom LLP served as its legal adviser.