Cox Enterprises is buying back stake in AutoTrader
Cox Enterprises is known as being the third largest cable operator in the U.S. Cox announced today that they are acquiring the 25% stake that they do not own in AutoTrader Group, which is an online car marketplace service. Cox sold the stake to private equity company Providence Equity Partners in 2010. After buying back the stake, Cox will now own 98% of AutoTrader. The other 2% are owned by past and present AutoTrader employees. The terms of the acquisition is undisclosed.
Sources with Reuters are reporting that Cox will buy the stake from Providence for $1.8 billion. Providence is expected to make three times the money on the transaction.
AutoTrader was founded in 1997. AutoTrader owns AutoTrader.com and the Kelley Blue Book brands. Last summer, Cox bought 5% in AutoTrader from VC firm Kleiner Perkins Caufield & Byers.
AutoTrader is not the only automotive company that Cox owns. Cox also owns car auction company Manheim.
Providence manages around $37 billion in investor commitments that are focused on media, education, and communications companies. Providence raised $5 billion as part of a private equity fund last summer.