IHS Inc. agreed to buy R.L. Polk & Co., the provider of Carfax vehicle-history data, in a $1.4 billion deal to boost its offerings for the global automotive industry and boost profit.
IHS will fund the takeover with 10 percent equity and the remainder with cash and loans, the Englewood, Colorado-based research company said in a statement today.
“R.L. Polk has a long history of providing critical information to the automotive industry,” Chief Executive Officer Scott Key said in the statement. “The acquisition of R.L. Polk brings extensive and complementary information and analytical solutions.”
R.L. Polk provides market data and analysis for the automotive industry, while Carfax offers vehicle history information for car buyers and dealers. The company generates about $400 million in revenue a year and is growing at mid- to high-single-digit rates, IHS said.
The market research company expects R.L. Polk to boost its profit margins within six to eight quarters. M. Klein & Co. advised IHS on the transaction. Evercore Partners Inc. advised R.L. Polk
IHS shares rose as much as 5 percent to $112.33 and were up 1.8 percent at 10:21 a.m. in New York. The stock has climbed 14 percent this year, valuing the company at $7.16 billion.