Reynolds and Universal Computer Systems to Merge in All-Cash Transaction Valued at $2.8 Billion
08 Agosto 2006 - 7:30AM
PR Newswire (US)
Combined organization to operate under the Reynolds and Reynolds
brand DAYTON, Ohio, and HOUSTON, Aug. 8 /PRNewswire-FirstCall/ --
The Reynolds and Reynolds Company (NYSE:REY) and Universal Computer
Systems, Inc., today announced a definitive agreement to merge
their two organizations to create the world's pre-eminent dealer
services company. Under the terms of the agreement, holders of
Reynolds' common stock will receive $40 per share in cash. The
transaction is valued at $2.8 billion, including the assumption of
Reynolds' debt. 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 named 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, Ohio. "Today is a great day for
Reynolds," said O'Neill. "We're creating the world's pre-eminent
dealer services provider by leveraging the great product and strong
technical capabilities of UCS while continuing to build on
Reynolds' relentless focus on serving our customers. "The
transaction we are announcing today is consistent with the
objective Reynolds announced in July of delivering substantial
shareholder value," O'Neill said. "Our shareholders will receive a
substantial and immediate premium on their investment. "The merger
also creates a dealer services powerhouse that is uniquely
positioned to deliver the outcomes that dealers need to succeed.
"As we go forward, we will continue to execute on our initiatives,
announced on July 21, to drive growth and productivity. With this
merger, we will leverage UCS technology and build on Reynolds'
products and our legacy of serving dealers with dedication,
innovation and experience," O'Neill said. O'Neill said that
Reynolds is committed to protecting customers' investments
regardless of the platforms they are currently using, including the
10,000 customers on the REYNOLDSYSTEM(TM). Bob Brockman, UCS
chairman and CEO, said, "Reynolds has distinguished itself in the
marketplace through its commitment to helping dealers succeed in
selling and servicing more cars and by measuring its success by
dealers' success. We are proud to bring forward our solutions to
build on Reynolds' great tradition of customer focus." 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. "Meeting our customer commitments continues to
be our top priority," O'Neill said. "We will integrate the two
organizations, putting the right resources against the right needs
to better serve our customers and grow our business. Details on how
we will accomplish the integration will be determined as we fully
develop our plan. "Associates at both companies will see new
opportunities, additional responsibilities, and professional
challenges," he said. 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 advisor to Reynolds and Reynolds, and
Wachtell Lipton Rosen and Katz served as its legal advisor. UCS was
advised by Credit Suisse, and Skadden, Arps, Slate, Meagher &
Flom LLP served as its legal advisor. Cautionary Notice Regarding
Forward-Looking Statements Certain statements contain
forward-looking statements, including statements relating to
results of operations. These forward-looking statements are based
on current expectations, estimates, forecasts and projections of
future company or industry performance based on management's
judgment, beliefs, current trends and market conditions. Actual
outcomes and results may differ materially from what is expressed,
forecasted or implied in any forward-looking statement.
Forward-looking statements made by the company may be identified by
the use of words such as "will," "expects," "intends," "plans,"
"anticipates," "believes," "seeks," "estimates," and similar
expressions. There are a number of risks and uncertainties that
could cause actual results to differ materially from the
forward-looking statements included in this document. For example,
(1) Reynolds may be unable to obtain shareholder approval required
for the transaction; (2) Reynolds may be unable to obtain
regulatory approvals required for the transaction, or required
regulatory approvals may delay the transaction or result in the
imposition of conditions that could have a material adverse effect
on Reynolds or cause the parties to abandon the transaction; (3)
conditions to the closing of the transaction may not be satisfied;
(4) Reynolds may be unable to achieve cost reduction and revenue
growth plans; (5) the transaction may involve unexpected costs or
unexpected liabilities; (6) the credit ratings of Reynolds or its
subsidiaries may be different from what the parties expect; (7) the
businesses of Reynolds may suffer as a result of uncertainty
surrounding the transaction; (8) the timing of the initiation,
progress or cancellation of significant contracts or arrangements,
the mix and timing of services sold in a particular period; and (9)
Reynolds may be adversely affected by other economic, business,
and/or competitive factors. These and other factors that could
cause actual results to differ materially from those expressed or
implied are discussed under "Risk Factors" in the Business section
of our most recent annual report on Form 10-K and other filings
with the Securities and Exchange Commission. The company undertakes
no obligation to update any forward-looking statements, whether as
a result of new information, future events or otherwise. About
Reynolds Reynolds and Reynolds ( http://www.reyrey.com/ ) has
helped automobile dealers sell cars and take care of customers
since 1927. Today, more than 15,000 dealers worldwide rely on
Reynolds to help run their dealerships. In the U.S. and Canada, the
REYNOLDSYSTEM(TM) combines comprehensive solutions, experienced
people and proven practices that drive total dealership performance
through a full range of retail Web and customer relationship
management solutions, e-learning and consulting services,
documents, data management and integration, networking and support
and leasing services. Internationally, Reynolds serves dealers in
more than 35 countries through a broad range of retailing solutions
and consulting services. About Universal Computer Systems Universal
Computer Systems offers a comprehensive solution for the computing
and business needs of automobile dealerships. The company is the
leader in innovation for dealership computer systems. Throughout
the 1980s, 1990s, and into the new millennium, Universal Computer
Systems has been the first to introduce many of the dealership
software applications available today. As a result of this
aggressive software development, Universal Computer Systems meets
and exceeds every dealership software need. Additional Information
and Where to Find It In connection with the proposed transaction, a
proxy statement of Reynolds and other materials will be filed with
SEC. WE URGE INVESTORS TO READ THE PROXY STATEMENT AND THESE OTHER
MATERIALS CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT REYNOLDS AND THE PROPOSED
TRANSACTION. Investors will be able to obtain free copies of the
proxy statement (when available) as well as other filed documents
containing information about Reynolds at http://www.sec.gov/, SEC's
Web site. Free copies of Reynolds' SEC filings are also available
on Reynolds' Web site at http://www.reyrey.com/. Participants in
the Solicitation Reynolds and its executive officers and directors
and Universal Computer Systems may be deemed, under SEC rules, to
be participants in the solicitation of proxies from Reynolds'
shareholders with respect to the proposed transaction. Information
regarding the officers and directors of Reynolds is included in its
definitive proxy statement for its 2006 annual meeting filed with
SEC on May 15, 2006. More detailed information regarding the
identity of potential participants, and their direct or indirect
interests, by securities, holdings or otherwise, will be set forth
in the proxy statement and other materials to be filed with the SEC
in connection with the proposed transaction. DATASOURCE: The
Reynolds and Reynolds Company CONTACT: Media, Mark Feighery,
+1-937-485-8107, , Investors, John E. Shave, +1-937-485-1633, ,
both of The Reynolds and Reynolds Company, Trey Hiers, of Universal
Computer Systems, +1-713-718-1800, , of Universal Computer Systems,
Inc. Web site: http://www.reyrey.com/
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