Automatic Data Processing Inc. (ADP) agreed to acquire privately
held Seattle Internet marketing company Cobalt for about $400
million, part of the payroll-processing and human-resources
outsourcing company's plans to expand its auto-dealer
offerings.
ADP has been hurt as high unemployment has cut into the number
of workers on clients' payrolls and spurred pricing pressures.
However, ADP and other staffing companies in recent months have
seen signs of improvement as the economy has stabilized.
A surge in auto-dealer closings last year amid the auto-sector's
woes have weighed on its dealer services segment in recent
quarters. The company in April forecast flat fiscal-year revenue,
including a 3% to 4% drop in its dealer-services business.
At that time, ADP reported third-quarter earnings edged up 0.3%
as the decline in pays-per-control, an important measure of
profitability for payroll-processing companies, slowed from a year
earlier.
Shares closed Thursday at $40.37 and were inactive
premarket.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com