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Reynolds and Reynolds Waits for Approval to Merge With Universal

August 14, 2006

After the recent announcement that an investment group was to pay $2.8 billion to buy dealer management systems companies Reynolds and Reynolds Co. and Universal Computer Systems Inc., it seems the merger was not what auto dealers thought.

According to Automotive News, Reynolds and Reynolds, would continue to market its system under its own brand. However, it would become a subsidiary of Universal Computer.

If Reynolds shareholders approve the deal, the company would also go private, like Universal. Universal Computer brand would then be discontinued.

Dealers who now use the Universal system wouldn’t be forced to switch to Reynolds. Reynolds plans to push the Universal system as a top-of-the-line computer system but under the Reynolds brand.

According to Reynolds and Reynolds, the merger is technically between their company and Racecar Acquisition Co., a wholly owned subsidiary that Universal Computer formed solely for structuring the deal.

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