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Sept. 26, 2011 /PRNewswire/ -- Genuine Parts Company (NYSE: GPC) and the Exego Group ("Exego") announced today that they have entered into a definitive strategic agreement whereby Exego will issue new shares to Genuine Parts Company, representing a 30% stake in Exego for approximately
$150 million (US$) in cash. Exego, headquartered in
Melbourne, Australia, is a leading aftermarket distributor of automotive replacement parts and accessories in Australasia, with annual revenues of approximately
$1 billion (US$) and a company-owned store footprint of more than 430 locations across
New Zealand. Subject to regulatory approvals, the effective date of the investment is expected to be on or around
December 1, 2011.
Genuine Parts Company will have the option to acquire the remaining shares of the Exego Group at a later date, subject to Exego meeting certain earnings thresholds.
Thomas C. Gallagher, Chairman, President and Chief Executive Officer of Genuine Parts Company, stated, "With this investment, Genuine Parts is well positioned to participate in the significant long-term growth opportunities in the Australasian aftermarket and the potential for targeted growth in
Asia. Utilizing an initial minority investment in Exego, we are able to align ourselves with a company that has a leading market position and a long and successful history approaching almost 90 years in the automotive business. Exego is a familiar partner to us, as we have had the benefit of an informal relationship with their team for the last twenty years. The structure of this agreement will truly benefit our shareholders over the long-term and allow us to participate in one of the fastest growing automotive aftermarkets in the world in a disciplined manner."
The Exego Group Managing Director,
John Moller, said, "We have built a long-standing relationship with GPC and its NAPA group over the past twenty years and we are excited about the expertise and experience we can share between our businesses. NAPA's broad range of automotive products and strong focus on providing value to its customers align very well with the Exego Group. Genuine Parts Company is a natural long-term owner with a commitment to growth in this industry, and we intend to use the injected funds to pursue this objective."
Forward Looking Statements
Some statements in this report, as well as in other materials we file with the Securities and Exchange Commission (SEC) or otherwise release to the public and in materials that we make available on our website, constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Senior officers may also make verbal statements to analysts, investors, the media and others that are forward-looking. Forward-looking statements may relate, for example, to future operations, prospects, strategies, financial condition, economic performance (including growth and earnings), industry conditions and demand for products and services. The Company cautions that its forward-looking statements involve risks and uncertainties, and while we believe that our expectations for the future are reasonable in view of currently available information, you are cautioned not to place undue reliance on our forward-looking statements. Actual results or events may differ materially from those indicated as a result of various important factors. Such factors may include, among other things, slowing demand for the Company's and Exego's products and services, changes in general economic conditions, including, unemployment, inflation or deflation, high energy costs, uncertain credit, foreign exchange and international markets and other macro-economic conditions, the ability to maintain favorable vendor arrangements and relationships, disruptions in vendors' operations, competitive product, service and pricing pressures, the Company's and Exego's ability to successfully implement their respective business strategies, the uncertainties and costs of litigation, as well as other risks and uncertainties discussed in the Company's Annual Report on Form 10-K for 2010 and from time to time in the Company's subsequent filings with the SEC.