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What is The Value of Kelley Blue Book?

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On: Mon, Sep 13, 2010 at 4:53PM | By: Sherry Christiansen

What is The Value of Kelley Blue Book?

According to a Financial Times report quoted in a blog on the New York Times website, Kelly Blue Book is up for sale. Two bankers who did not want to be identified say they have the “inside scoop on the potential sale.”

So the question that is on everyone’s mind: “what is the blue book value of Kelly Blue Book?”

According to the anonymous banker, the value of the business is somewhere around $500 million, and possibly as much as $1 billion.

Kelley Blue Book was a family business which originated as far back as 1918 in California when Les Kelley, founder, created a wish list of cars he wanted to obtain for his dealership that included his estimated retail value. Kelley’s ability to “nail a price” resulted in the first publication of the Kelley Blue Book guide in 1926. After World War II when the car industry was thriving, so was the growth of Kelley Blue Book. The family then sold the business to Charlie Cook in the 60s, but the business continued to be managed by a Kelly family member up until the year 2000.

Two sources have reported that J.P. Morgan has been contacted and retained to conduct the upcoming sale of the multi-million dollar (and possibly billion dollar) company. Kelley Blue Book refused to comment on the issue.

When the Blue Book guide began, it was developed as a tool for auto industry professionals to use to value cars for trade-in. As the book evolved, it became popular as a gauge for consumers to use as well, in order to get a solid estimate of what they could expect as a trade-in, or to price their cars to sell by owner.
As the internet became more and more popular, Kelly Blue Book evolved as well as an internet-based business providing price information and related services for auto dealers and consumers alike.

According to The Financial Times, Auto Trader.com is the number one bidder in line to purchase Kelly Blue Book. As Bloomberg News points out in a recent article about the valuation of the company, “that wide-ranging estimate would probably not have pleased Lee Kelley, whose ability to pinpoint a price earned him his fame.”


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