No. of Recommendations: 2
Per below news article and press release from BBU, things are finally limping back to normal.
BBU says they do not expect this incident to have a material impact. The price actions seems to agree. BBU closed at 19.68 the day before the incident. Today it closed at 18.80 which is 5% lower. It did go as low as 16.85 during the incident which is 15% lower.
Perhaps someone with more insight into this can explain how there is no material impact on BBU when the dealers are filing there was a material impact on them due to lost sales. Is it because insurance will cover all BBU liabilities including the ransom if paid?
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The cyber incident that affected about 15,000 auto dealerships across North America is over. CDK Global said "substantially all" dealers in its network have seen backend management systems restored.
"We are ahead of the anticipated schedule," Tony Macrito, senior communications director at CDK, wrote in an email response to Bloomberg.
Disruptions began on Wednesday, June 19, after hacking group BlackSuit paralyzed CDK's backend systems with ransomware, demanding millions of dollars. In return, thousands of dealers could not buy or sell vehicles for about three weeks, forcing some to switch to paper and pen to complete transactions. CDK said on Monday that all dealers are expected to be live by Wednesday, if not Thursday, at the latest.
According to an estimate by Anderson Economic Group, the CDK disruption caused nearly a billion dollars in direct losses for car dealers.
Several dealers, including Sonic Automotive Inc., Penske Automotive Group Inc., Group 1 Automotive Inc., AutoNation Inc., Lithia Motors Inc., and Asbury Automotive Group Inc., have warned in SEC filings about a potential "material" impact from the attack.
Bloomberg noted, "Vehicle sales were forecast to slow to an annualized rate of around 15.8 million vehicles in June, down from 16.1 million a year ago, due in part to the attack."
https://www.zerohedge.com/technology/cdk-global-sa...====================
On June 19, CDK detected and promptly responded to unauthorized cyber activity on its network. CDK proactively shut all systems down, engaged third-party experts to address and investigate the issue and notified law enforcement.
CDK has successfully brought substantially all customers back onto its core dealer management system in advance of the July 4 holiday weekend in the U.S. The business is also working to bring back online other applications including its Customer Relationship Management and Services solutions. In the interim, CDK continues to actively engage with its customers to support their sales and service efforts.
We do not expect this incident to have a material impact on Brookfield Business Partners.
https://bbu.brookfield.com/press-releases/bbu/broo... 