by Burke Speaker | October 16, 2013 12:52 pm
In a move that would create the largest parts vendor in North America, Advance Auto Parts (AAP) has announced it is buying the Carquest brand — owned by General Parts International – for a reported $2 billion.
“This transformational transaction provides a compelling strategic opportunity for Advance to expand our geographic presence and commercial capabilities to better serve customers,” Advance CEO Darren Jackson said in a statement.
“We believe the combination of the two companies is a great fit and the synergy of [General's] assets with our capabilities will allow us to capitalize on market opportunities that will create value for our shareholders and provide even better service to our customers.”
From The Street:
Privately-held General Parts operates 1,246 stores under the Carquest brand and franchises an additional 1,418 locations. The company also operates Worldpac, an importer and distributor of original equipment and replacement parts to import specialists.
Advance, which operates 4,018 stores in 39 states, Puerto Rico, and the Virgin Islands, said the deal would create an automotive part powerhouse with annual sales of more than $9.2 billion. The company said it believes it can extract annual synergies of $160 million within three years, and post-deal should have the scale needed to expand its geographic footprint nationwide.
Jackson will remain CEO of AAP, with General Parts president O. Temple Sloan III remaining as head of the unit and joining the board of directors of the newly combined companies.
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