Pep Boys calls off sale to Gores Group.
30 May 2012 a[euro]" The Pep Boys - Manny, Moe & Jack (NYSE:PBY), the US automotive parts retailer and aftermarket services provider, announced its agreement to cancel its proposed sale to US private equity firm The Gores Group LLC.
Gores will pay Pep Boys a termination fee of USD50m (EUR40m) and also foot the bill for some of the targeta[euro](tm)s acquisition-related expenses. Given the latest development, Pep Boys has cancelled the special shareholder meeting that was to take place today.
Mike Odell, president and chief executive of Pep Boys, said that the collapse of the deal would not deter the company from its goal to become the preferred automotive solutions providers for customers focused on value. Pep Boys remains committed to growing its business and proving itself trustworthy every day. The mild winter, subdued consumer spending and delayed implementation of new technology are among the factors that have affected negatively Pep Boysa[euro](tm) recent performance but the company remains on track with its transformation.
Odell went on to add that Pep Boys was in a solid financial position. It will use the proceeds from the settlement and cash on hand to repay its terms loan this year and refinance its senior subordinated notes next year.
The definitive merger agreement with Gores was announced on 30 January, when Pep Boys said the private equity group would pay USD15 per share to acquire the business. The deal was valued at USD1bn in enterprise terms.Country: USASector: Motor Vehicles, Wholesale/RetailTarget: The Pep Boys - Manny, Moe & JackBuyer: The Gores Group LLCDeal size in USD: 1bnType: LBOStatus: TerminatedComment: Deal size includes debt
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|Publication:||M & A Navigator|
|Date:||May 30, 2012|
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