In a deal that will add more than 800 locations to its existing 2,200 tire and auto service centers in the U.S., Bridgestone Americas will buy The Pep Boys auto parts chain for $15 per share, or approximately $835 million, in an all-cash transaction.
The combined company will also be able to leverage Pep Boys’ extensive distribution network for Bridgestone’s company-owned stores and its more than 5,000 U.S. dealers and distributors.
The Pep Boys — Manny, Moe & Jack have been in the automotive aftermarket business since 1921, but recently the company has struggled, losing $27.3 million on more than $2 billion in sales in fiscal 2014. Overall, however, the auto parts vertical is in a growth position, with owners keeping their cars on the road longer rather than replacing them with new models.
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“Bridgestone and Pep Boys are two leading companies that share a proud heritage in the American automotive services industry,” said Gary Garfield, CEO and President of Bridgestone Americas in a statement. “Our shared expertise and commitment to our customers and employees will help us build an even stronger organization.”
The deal, structured as a merger between The Pep Boys and Bridgestone Retail Operations, LLC is expected to close in the beginning of 2016.
