ABS Capital Partners

ADP Enters Definitive Agreement to acquire ABS Capital Portfolio Company Cobalt

ROSELAND, N.J., Jul 9, 2010 — Automatic Data Processing, Inc. has entered into a definitive agreement to acquire Cobalt for approximately $400 million, in cash, Gary C. Butler, president and chief executive officer, announced today. The transaction is subject to normal regulatory review and is expected to close in four to six weeks.

Commenting on the transaction, Mr. Butler said, “I am pleased to announce this transaction. Acquisitions that complement our core businesses are a key part of ADP’s five-point strategic growth program and the primary focus of our capital allocation strategy. Cobalt is the leading provider of digital marketing solutions to automotive manufacturers and dealers in North America. This transaction aligns with ADP Dealer Services’ global layered applications strategy to increase “share of wallet” beyond its core dealer management system offering. We believe the timing of this transaction is optimal as online advertising spend is expected to continue to outpace that of traditional channels in the U.S.”

Cobalt is privately held and headquartered in Seattle, Washington. ADP expects the transaction to be slightly accretive in the first year, with continued positive earnings contributions anticipated in subsequent years.

ADP’s capital allocation strategy also includes returning excess cash to shareholders through share repurchases and dividends. For the fiscal year ended June 30, 2010, ADP repurchased about $18.2 million shares for over $765 million, and additionally paid nearly $675 million in dividends to its shareholders. Nearly 29 million shares remain available for purchase under the current board of directors authorization.