Car part supplier Bridgestone is buying out Pep Boys in a $US835 million deal, or $US15 per share. The deal takes the auto repair and service center off markets at a premium of more than 23%.
Pep Boys stock shot up 22% in premarket trading on the news.
It’s not the first time Pep Boys had considered the advances of a bidder in recent years. After a lengthy back-and-forth with Alec Gores’ private equity firm in 2012, the company and its prospective buyer abandoned their agreement, sending Pep Boys shares down sharply.
2015, however, has been a good year for Pep Boys investors. The stock was already up more than 20% by the time Bridgestone submitted a bid.
Pep Boys has more than 800 locations across 35 states. Bridgestone Americas, the buyer, is a subsidiary of Japan’s Bridgestone; it is perhaps best known for tire brands including Firestone and Bridgestone.
JPMorgan was the advisor to Bridgestone on the transaction and Pep Boys received advice from Rothschild, according to a statement.
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