The Low-Profile Guy Behind the UCS-Reynolds Hookup

Robert T. Brockman may be the most influential person today among information-technology vendors in the automotive retail space.

But he doesn't necessarily want you to know it.

Brockman is the founder and CEO of dealer-management system provider Universal Computer Systems Inc. in Houston. Recently, he put together the financed deal to acquire competitor Reynolds and Reynolds Co. for $2.8 billion, a case of a smaller company buying a much bigger one. If it goes through, if could alter the industry's landscape.

Meanwhile, Brockman quietly is amassing several companies that serve dealers. UCS is a private firm and information is difficult to come by, but Brockman reportedly has acquired four of the six key security companies that exhibited at the National Automobile Dealers Assn. convention in February.

Employees may not even be aware of who owns their companies. They compete as if they have different owners. The secret got out only because the four each listed a UCS address in the NADA convention handbook.

Brockman also acquired call measurement and tracking company, CallBright, sometime last year. Meanwhile, one of his partners in the Reynolds deal, Vista Equity, recently purchased Who's Calling, a competitor to CallBright. It is not clear, however, if Brockman had anything to do with that deal, but the connection is there.

And those are among the known deals.

Brockman eschews publicity — his media handlers do not have a picture or a biography of him on file. He refuses interviews.

People who know him say he is philanthropic but refuses to trumpet that.

Customers and vendor partners say he is a tough and savvy businessman who operates on his terms. Like him or not, he has built an impressive business in Texas that now has more than 2,000 employees and three offices in Europe.

UCS says it has about 750 dealers as customers. But according to Ward's estimates and others, UCS's market share is closer to 7%, to almost 1,500 dealerships.

The 750 number might be actual contracts UCS has, which would include dealer groups with multiple points. Nonetheless, UCS's market share recently dropped to fourth behind Automatic Data Processing Inc., Reynolds and AutoSoft.

The Reynolds acquisition would make the company the No.1 provider of technology systems to dealers.

Brockman began his company in his living room in 1970, providing dealerships with parts-inventory data.

In 1982, UCS began offering computer systems to dealers. The company grew quickly, claiming third place in the DMS space behind Reynolds and ADP.

UCS acquired Ford Motor Co.'s Dealer Computer Systems in the mid-1990s, which later became the basis for Ford's electronic-parts catalog for its dealers. UCS recently sold DCS to competitor ProQuest after losing a licensing contract last year with Ford.

On October 7, Credit Suisse, UCS's advisor, approached Reynolds' chairman about a possible deal that would net shareholders $33-$35 a share. In mid-November, the Reynolds board rejected the offer. claiming concerns that UCS couldn't fund the deal. Brockman persisted, sending the board a letter with a deadline, sparking speculation that he threatened to take the deal directly to Reynolds' shareholders should the board continue to resist.

Whatever was in the letter, it resulted in further discussions. As the talks became more substantive, Reynolds approached three other companies in late June inviting them submit bids, which they declined to do, leaving UCS as the only, albeit, attractive option.

Once the price increased to where Reynolds' shareholders will receive $40 a share, it was game over and the board had to accept.
— Cliff Banks