Bridgestone to Buy Auto Parts Retailer Pep Boys for $835M

Reuters

Japanese tire maker Bridgestone said it would buy auto parts retailer Pep Boys-Manny, Moe & Jack for $835 million in cash to expand its presence in the United States.

The $15-per-share deal represents a premium of 23.5 percent to Pep Boys' Friday closing price of $12.15.

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The deal would expand Bridgestone Retail Operations LLC's (BSRO) network by more than 35 percent in the United States, Bridgestone said.

BSRO, which is a unit of Bridgestone, operates a chain of auto care and tire stores in the United States.

Pep Boys will add about 800 locations to BSRO's existing 2,200 tire and automotive service centers, which operate under the Firestone Complete Auto Care, Tires Plus, Hibdon Tires Plus and Wheel Works banners.

In June, the auto parts retailer said it was considering selling itself as part of a strategic review.

JP Morgan Securities LLC was the financial adviser to Bridgestone. Rothschild acted for Pep Boys.

The deal is expected to close in the beginning of 2016.

Pep-Boys' shares were trading at $14.91 before the opening bell.

(Reporting by Arunima Banerjee in Bengaluru; Editing by Maju Samuel)