This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Deal: Advanced Auto Parts Picks Up Carquest Brand

Stocks in this article: AAP

NEW YORK ( TheStreet) -- Advance Auto Parts (AAP) 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 General's assets with our capabilities will allow us to capitalize on market opportunities that will create value for our shareholders and provide even better service to our customers."

Advance said it would fund the deal through a combination of senior notes, bank debt and existing cash on hand. In connection with the deal, which is expected to close in late 2013 or early 2014, Advance said it has received a financing commitment from JPMorgan Chase.

The agreement would require Advance to pay a termination fee of $185 million should it be unable to secure the needed financing.

Post-deal Jackson would remain CEO of Advance, with General Parts president O. Temple Sloan III continuing as head of the unit and joining the combined company's board of directors. Sloan called the deal "the next logical step in our company's evolution," saying "with a more robust offering and a shared focus on best-in-class customer service, our combined business will continue to deliver value for customers and shareholders."

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,290.14 +221.27 1.30%
S&P 500 2,004.46 +31.72 1.61%
NASDAQ 4,625.8460 +78.0120 1.72%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs