Reynolds and Reynolds Co, the Dayton, Ohio information management system company, has bought a 26% stake in the UK Kalamazoo Computer Group Plc for $35m. After the deal has been completed, two Reynolds directors will join the Kalamazoo board. David Holmes, Reynolds’ chairman, president and chief executive, said: Kalamazoo has established a leadership position throughout the UK and Europe as a systems and services provider to automotive retailers. From a cultural and business practices perspective, we see strong synergies between our two companies. The deal removes the uncertainty which has hung over Kalamazoo since the breakdown of take-over talks with Lynx Holdings Plc (CI No 3,187). Poor financial performances led it to sell off its security print division and reorganize into an international and UK computer division. Kalamazoo’s strength in the field of software for car dealers – particularly Ford dealers – has led to close relationships with Reynolds which provides systems for the automotive, healthcare and general business markets. In view of recent performances, Kalamazoo is ripe for a complete take-over but an obstacle is the Kalamazoo Trust, an employees’ fund which holds 50% of the shares.
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