Lehman Brothers Collection - Contemporary Business Archives

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Lehman Brothers Collection

Twentieth-Century Business Archives

Automatic Data Processing, Inc. - Lehman Brothers Collection

Automatic Data Processing, Inc.

List of Deals

In 1949 Henry Taub founded Automatic Payrolls, Inc., in Paterson, New Jersey, to provide payroll services for other companies. The company made steady yet moderate progress through the 1950s. During the first few years of the company's existence, Joe Taub and Frank Lautenberg joined Henry, forming a strong directorship.

The company switched from manual bookkeeping machines to an early IBM computer in 1957. The new equipment allowed Automatic Payrolls to expand into general data-processing services such as analytical reports covering sales, costs and inventories, questionnaire tabulation, and maintenance of bowling league statistics. To deal with their general data-processing services, Taub set up a separate company, Automatic Tabulating Services, in 1959.

In 1961 the two companies were merged into Automatic Data Processing (ADP). The company went public the same year, and opened an office in downtown Manhattan to process "back-office data." This service would later become the company's second most important line of work.

ADP thrived in the 1960s and began an acquisitions program mid-decade. A significant purchase was that of Computer Services of Florida, based in Miami; this was the first company far removed from ADP's original geographic area. In 1966 the company entered into the business of providing diversified graphic arts reproduction services for general commercial use through the acquisition of the stock of the Independent Companies. The company entered into the business of providing medical and scientific information publishing services in 1968 through the acquisition of the stock of the S&M Companies. In 1971 the company entered into the business of mutual fund shareholder accounting services through the acquisition of E & H Shareholder Services, Inc. By 1972 the company operated centers in twenty cities from which it paid over one million people.

The company acquired CSI Computer Systems of Cincinnati, which provided services to car dealers, in 1972. This was the beginning of ADP's third major line of work, dealer services. That same year, ADP acquired Computer Communications Network, Inc., which provided on-line interactive accounting systems for wholesale distributors and hospitals. In 1973, ADP acquired National Inventory Control System, which provided inventory control data-processing services to dealers in the automobile, truck, industrial equipment, farm equipment, and related industries.

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