ROSELAND, N.J. (AP) -- ADP will spin off into a separate, publicly traded company its business that provides services to auto dealerships .
The payroll processor said Thursday that it wants to focus more on providing human resource services to clients.
The business that is being carved off provides retail and digital marketing services to automakers and dealers and has nearly $2 billion in revenue a year. ADP had total revenue of $11.3 billion last year.
"The dealer services business remains attractive in terms of long-term growth opportunities," said CEO Carlos Rodriguez. "However, we believe this transaction will benefit ADP's shareholders by allowing each management team to better focus on its own business and strategic opportunities."
ADP expects to make at least $700 million, tax free, from the spinoff. It plans to use that money to buy back its own stock. It will keep its quarterly dividend at 48 cents per share.
The deal is expected to close in the fourth quarter of 2014.
Shares of Automatic Data Processing Inc., based in Roseland, N.J., rose $1.65, or 2.2 percent, to $77.53 in morning trading.