NEW YORK ( TheStreet) -- Advance Auto Parts (AAP - Get Report) said Wednesday it would acquire General Parts International Inc. in a $2.04 billion cash deal that would create the largest aftermarket parts vendor in North America.
Privately-held General Parts operates 1,246 stores under the Carquest brand and franchises an additional 1,418 locations. The company also operates Worldpac, an importer and distributor of original equipment and replacement parts to import specialists.
Advance, which operates 4,018 stores in 39 states, Puerto Rico, and the Virgin Islands, said the deal would create an automotive part powerhouse with annual sales of more than $9.2 billion. The company said it believes it can extract annual synergies of $160 million within three years, and post-deal should have the scale needed to expand its geographic footprint nationwide.
Rival AutoZone (AZO), by comparison, generated $9.15 billion in sales for the year ending Aug. 31."This transformational transaction provides a compelling strategic opportunity for Advance to expand our geographic presence and commercial capabilities to better serve customers," Advance CEO Darren Jackson said in a statement. "We believe the combination of the two companies is a great fit and the synergy of