Advance Auto Parts has agreed to purchase General Parts International Brand Carquest for $2.04 billion, the company announced via a press release on Tuesday.
In the deal, General Parts president O. Temple Sloan will sit on Advance's board of directors.
"We are excited to bring together two highly complementary automotive aftermarket companies," Sloan said in a statement. "The combination with Advance Auto Parts is the next logical step in our company's evolution. Advance's retail presence, strong capability infrastructure and acquisition integration experience combined with GPII's leadership in the commercial, independent and import segments creates a powerful platform to drive profitable growth. 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."
The new company will be located in Roanoke, Va. General Parts International will also keep its headquarters in Raleigh, N.C.
Advance Auto Parts plans to pay for the transaction through bonds, bank debt, and savings the press release reported. JPMorgan Chase Bank is also assisting with financing of the deal, which both sides anticipate completing before it closes late this year or early next year.
"This transformational transaction provides a compelling strategic opportunity for Advance to expand our geographic presence and commercial capabilities to better serve customers," Darren Jackson, Advance chief executive officer said in a statement. "The addition of 1,246 company operated stores and 1,418 independently owned Carquest locations provides us with an immediate platform and scale across North America, full market coverage and the opportunity to position ourselves as the market leader in the commercial business. We believe the combination of the two companies is a great fit and the value for our shareholders and provide even better service to our customers. We welcome and look forward to working with the talented leaders and team members from GPII."
