- The stock price of CDK Global, Inc. (NASDAQ: CDK) increased by over 11% during intraday trading today. This is why.
The stock price of CDK Global, Inc. (NASDAQ: CDK) increased by over 11% during intraday trading today. Investors are responding positively to CDK announcing that it entered into a definitive agreement to be acquired by Brookfield Business Partners, together with institutional partners for a total enterprise value of $8.3 billion.
Under the terms of the merger agreement, Brookfield is going to commence a tender offer to acquire all of the outstanding shares of CDK. And CDK shareholders will receive $54.87 per share in cash upon completion of the transaction, which represents a 30% premium to the unaffected closing price of CDK stock on February 18, 2022, the last full trading day prior to market speculation regarding a potential sale of the company. This agreement was unanimously approved by CDK’s Board of Directors, which recommends that CDK stockholders tender their shares in the offer.
As the flagship listed vehicle of Brookfield Asset Management’s Private Equity Group, Brookfield Business Partners is focused on owning and operating high-quality businesses that provide essential products and services and benefit from a strong competitive position. And Brookfield Asset Management is a leading global alternative asset manager with approximately $690 billion of assets under management.
“This transaction is an exciting next step for CDK that provides our shareholders with both certainty of value and a meaningful premium. It also allows CDK to continue executing our long-term strategy to connect our industry at every level and create an open and collaborative future. In consultation with our outside advisors, CDK’s Board of Directors carefully evaluated a range of strategic and financial alternatives over several months and determined that this transaction is superior to all other available alternatives.”
“Brookfield recognizes the unique value our products bring to more than 15,000 retail locations in North America and shares our vision of transforming the future of automotive retail. We are excited about the opportunity to further sharpen our focus on elevating the dealer and consumer experience when selling, buying or owning a vehicle. I am grateful for our team’s incredible work in providing an integrated experience —from sourcing to retail sale, and beyond.”
— Brian Krzanich, president and chief executive officer, CDK Global
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