ADP Sets the Record Straight and Addresses Pershing Square's False and Misleading Claims With Facts

ROSELAND, NJ--(Marketwired - Nov 1, 2017) - ADP (NASDAQ: ADP) today issued the following statement:

ADP's Annual Meeting of Stockholders is rapidly approaching on November 7. The Company urges all ADP stockholders to protect the value of their investment by voting online or by phone today using the WHITE proxy card in support of ADP's 10 highly qualified directors.

Throughout this proxy contest, Pershing Square has continued to distort the facts and mislead the investing public in an attempt to discredit ADP. ADP strongly rejects the false and reckless claims made by Pershing Square's Bill Ackman, and believes it is imperative to set the record straight for investors.

Pershing Square Claims Vs. ADP Facts

Claim: ADP initiated the proxy fight.

Fact: Bill Ackman first contacted ADP with a phone call on August 1 -- only nine days before ADP's nomination deadline -- requesting an extension for the nomination deadline, and stating that he planned to nominate five directors, including himself, to ADP's 10-member Board of Directors. He also said CEO Carlos Rodriguez should be replaced. The full Board offered to meet before August 10, but Mr. Ackman declined because he said he wasn't ready with his presentation, and in any case, he was leaving on a vacation on the evening of August 3.

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Claim: Pershing Square owns 8.3% of ADP's common stock. 

Fact: Pershing Square announced an economic stake of 8.3% in August, the vast majority of which is held in derivatives, which cannot be voted at the upcoming meeting. In actual fact, as of the record date, Pershing Square owns only about 2% of ADP's common stock and can only vote those shares. 

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Claim: CDK's margins are higher than ADP's and demonstrate that ADP is underachieving its margin expansion opportunity.

Fact: Margin comparisons between ADP and CDK Global are misleading. In its adjusted margin calculation, CDK excludes stock compensation, depreciation and amortization, and transformation expenses -- all of which are included in ADP's adjusted EBIT margin. When the two companies' FY 2017 margins are analyzed on a comparable basis by excluding pass-throughs, ADP's adjusted EBIT margin is actually 200 basis points higher than CDK's.