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Advanced Auto Parts Spends $2 Billion to Become Biggest Auto Parts Retailer in North America

By  +Follow October 16, 2013 8:43AM
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Advanced Auto Parts (AAP) is making a move to become the biggest player in the North American auto parts industry, saying on Wednesday that it has agreed to acquire privately held General Parts International, Inc. in an all-cash deal with an enterprise value of $2.04 billion. With the purchase, Advanced Auto Parts will add 1,246 corporate-owned stores and 1.418 independently owned Carquest locations, giving it a platform and scale across the continent. General Parts also owns Worldpac, a supplier of replacement parts for imported vehicle brands.

The merge company will have annual sales of $9.2 billion, edging past current leader AutoZone Inc. (AZO) , which recorded about $9 billion in sales for the year ended August 31.

Advanced expects the acquisition will result in about $160 million in annual run-rate synergies that will be realized three years after closing.  The company also expects increased free cash flow and deliver estimated fiscal 2014 earnings per share accretion in excess of 20 percent, less one-time expenses.

Both boards have approved the transaction, which is expected to close late this year or early in 2014.

O. Temple Sloan, III, is expected to join the board at Advanced Auto Parts and will retain his position as president of General Parts, reporting to Advanced chief executive Darren Jackson. The combined company will remain headquartered in Roanoke, Virginia, the current home of Advanced, although it will keep its presence in Raleigh, North Carolina (General’s headquarters) as well.

“This transformational transaction provides a compelling strategic opportunity for Advanced to expand our geographic presence and commercial capabilities to better serve customers,” said Jackson in a statement this morning.

“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,” added Sloan.

Advanced has bought its way to become the biggest auto parts player in North America to offset tepid sales as booming auto sales are keeping fewer people from needing replacement parts.  In December the company bought BWP Distributors for an undisclosed cash amount.  As part of that deal, Advanced picked-up 124 BWP company-owned stores transferred the rights to distribute to 92 independently owned locations to an affiliate of General Parts.

Wall Street is cheering the acquisition, sending shares of AAP roaring ahead 16 percent to $96 in morning trading, including printing a new to all-time high at $99.30.  Through Tuesday’s close at $82.50, shares were up about 15 percent so far in 2013.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for AAP
ClosingBell
24 Oct 14 16:05:08
RT @LaMonicaBuzz: Eclectic mix of stocks at all-time highs today: $AAPL $FB $MMM $CVS $CSX $UNP $LOW $HD $CELG $AMGN $TRV $PANW $KR $GD $LB…
Clair Voight
24 Oct 14 13:00:45
$AAP Today Advance Auto Parts (AAP) Hits New Lifetime High http://t.co/rkmgY9pg3Z
John Turner
24 Oct 14 13:00:44
$AAP Advance Auto Parts Moves Up In Market Cap Rank, Passing CenterPoint Energy http://t.co/x34JVwREL9
Stock Relay
24 Oct 14 09:32:10
wininstocks2014: Stock Charts: AAP 140.96 Stock Charts $AAP Advance Auto Parts http://t.co/Ftn7Fi6Ure
wininstocks2014
24 Oct 14 09:30:18
AAP 140.96 Stock Charts $AAP Advance Auto Parts Inc. (NYSE) Last Updated: 10/24/2014 11:30:19 AAP Stock Chart http://t.co/M8ySewT0kp
Peter Bardens
24 Oct 14 09:00:38
$AAP Today Advance Auto Parts (AAP) Hits New Lifetime High http://t.co/KvqtkNyAcg
John Turner
24 Oct 14 09:00:36
$AAP Advance Auto Parts Moves Up In Market Cap Rank, Passing CenterPoint Energy http://t.co/blDAzLRKez
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24 Oct 14 01:39:35
Review of Super_Trades service - see what all his subs are raving about! http://t.co/eaD6UiJ6nc $BAH $GLNG $AAP #trading
Henry@Futurist
23 Oct 14 18:42:23
Five Leading Stocks Stage Breakouts As Market Rallies http://t.co/ED3rjneRpJ #IBDNews via @IBDinvestors $AKRX $LCI $ORLY $AAP $ILMN
Ed Carson
23 Oct 14 17:45:32
RT @IBD_NGondo: Five leading stocks staging breakouts as market rallies: http://t.co/l6Ww5UVKg8 $AKRX $ORLY $AAP
Nancy Gondo
23 Oct 14 16:30:12
Five leading stocks staging breakouts as market rallies: http://t.co/zEB6YnfvOx $AKRX $ORLY $AAP
Harry Walkman
23 Oct 14 15:01:49
$AAP Today Advance Auto Parts (AAP) Hits New Lifetime High http://t.co/cj5uqoPMnN
Lil' Dividend
23 Oct 14 12:51:37
RT @LaMonicaBuzz: Eclectic mix of stocks at all-time highs today: $AAPL $FB $MMM $CVS $CSX $UNP $LOW $HD $CELG $AMGN $TRV $PANW $KR $GD $LB…
Media Sentiment
23 Oct 14 12:39:52
$AAP received a new alert. Find out why at http://t.co/nZwqRf3BRT #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 645
P. Ricatti
23 Oct 14 12:39:12
RT @LaMonicaBuzz: Eclectic mix of stocks at all-time highs today: $AAPL $FB $MMM $CVS $CSX $UNP $LOW $HD $CELG $AMGN $TRV $PANW $KR $GD $LB…
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23 Oct 14 12:38:27
Advance Auto Parts $AAP Showing Bullish Technicals With Support At $135.86 ( http://t.co/MQF5SEjcgb )
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23 Oct 14 12:37:07
An Aging U.S. Vehicle Population And Buybacks Make AutoZone A Solid Investment $AZO $AAP $F $GM http://t.co/0lUOoVyWKZ
Paul R. La Monica
23 Oct 14 12:36:22
Eclectic mix of stocks at all-time highs today: $AAPL $FB $MMM $CVS $CSX $UNP $LOW $HD $CELG $AMGN $TRV $PANW $KR $GD $LB $DPS $ORLY $AAP
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23 Oct 14 09:48:15
Stock Indexes Build On Gains; Apple Breaks Out In Fast Trade: http://t.co/Y51ia9qRMF $AAPL $FB $UNP $CELG $AAP
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23 Oct 14 09:48:15
Stock Indexes Build On Gains; Apple Breaks Out In Fast Trade: http://t.co/hlDztESmvv $AAPL $FB $UNP $CELG $AAP
devd12
23 Oct 14 09:34:08
RT @JBoorman: $GPC (no posn) monster week, up 8 days straight, $AAP looks good also http://t.co/c1bXdwSMpc
Bill Gunderson
23 Oct 14 08:46:58
Very nice breakout in $AAP today. Another stock that I picked up during yesterday's swoon. #23 BSN rank. I am long.
sumeet vatsa
23 Oct 14 08:27:00
Breakouts galore $AAPL $ILMN $AMGN $CASY $CELG $MANH $POR $VVC $AEC $HSNI $AFSI $HNI $AHS $IDA $CUBE $HAS $AAP $CLDT $PEB $VAC $NTES $COST
Jon Boorman, CMT
23 Oct 14 07:53:48
$GPC (no posn) monster week, up 8 days straight, $AAP looks good also http://t.co/c1bXdwSMpc
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23 Oct 14 07:52:00
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Media Sentiment
23 Oct 14 07:20:07
$AAP received a new alert. Find out why at http://t.co/5udYd0Ofs6 #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 395
Market Trader Daily
23 Oct 14 07:15:40
$AAP 142.29 new high
Large Void Bot
23 Oct 14 07:08:13
New 52wk Highs: $AAP
W T
23 Oct 14 06:56:45
@diana_olick @GiovannyMoreano DIY makes a lot of personal financial sense... good for $HD, $LOW, and $SWK... even $AZO and $AAP.
Media Sentiment
23 Oct 14 05:54:59
$AAP received a new alert. Find out why at http://t.co/5udYd0Ofs6 #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 292
Mitchell Warren
23 Oct 14 05:53:56
An Aging U.S. Vehicle Population And Buybacks Make AutoZone A Solid Investment http://t.co/lvZU3SQ2zp $AZO $AAP
Seeking Alpha
23 Oct 14 05:51:00
An Aging U.S. Vehicle Population And Buybacks Make AutoZone A Solid Investment http://t.co/nKf20Hlp8M $AAP $F $GM $AZO
4-traders.com
23 Oct 14 05:35:15
Advance Auto Parts : to Report Third Quarter Results on November 6, 2014 http://t.co/94Mg7Fbdp3 $AAP
$Stocknewsalerts
23 Oct 14 05:33:06
$AAP Advance Auto Parts to Report Third Quarter Results on November 6, 2014 From our Stock News Alerts App
Jeffrey Blake
23 Oct 14 05:30:46
$AAP Advance Auto Parts Given Outperform Rating at Zacks (AAP) http://t.co/gLvy9mSVUz
BV Services
23 Oct 14 05:30:19
$AAP Advance Auto Parts to Report Third Quarter Results on November 6, 2014.. http://t.co/6hYVvReri0
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23 Oct 14 05:08:45
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Voland
23 Oct 14 03:46:31
@MarioGabelli what do you think about $ORLY & $AAP going forward. New car sales are at record, where will demand come from for parts?
Ticker Report
23 Oct 14 03:29:04
Zacks Reaffirms “Outperform” Rating for Advance Auto Parts $AAP http://t.co/1KpdA4btFr
PennyStock Zone
23 Oct 14 00:32:50
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Daily Contracts
22 Oct 14 11:22:00
Real-Time feed of company contracts, original agreements and executive updates from Advance Auto Parts $AAP http://t.co/h0OSTwtTCY
WKRB News
22 Oct 14 11:11:00
Advance Auto Parts Given Outperform Rating at Zacks $AAP http://t.co/qjgOpWjCbd
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22 Oct 14 11:06:17
Advance Auto Parts Earns “Outperform” Rating from Zacks $AAP http://t.co/rauNtINIEV
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22 Oct 14 10:29:42
Stock Analysts’ Ratings Reiterations for October, 22nd $AAP, ACE, ATCV, ATR, BAYRY, CELG, CMG, CNI, DFS, ENDP http://t.co/3dW3M1rAhC
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22 Oct 14 09:31:26
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Livevol Community
22 Oct 14 09:00:06
HIGH PUT VOLU $LTM 1871% $TGTX 1786% $FTNT 922% $OC 901% $KRE 755% $TUP 709% $AAP 677% $CHMT 637% http://t.co/gwzPxhnztr
Media Sentiment
22 Oct 14 07:05:14
$AAP received a new alert. Find out why at http://t.co/5udYd0Ofs6 #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 317
Market Int Center
22 Oct 14 07:01:33
Advance Auto Parts $AAP Showing Bullish Technicals With Support At $139.39 ( http://t.co/yq2udBEc3i )
Samuel Brown
22 Oct 14 05:02:34
$AAP Today Advance Auto Parts (AAP) Hits New Lifetime High http://t.co/aU66pQ94Su
PennyStock Zone
22 Oct 14 03:16:38
Review of Super_Trades service - see what all his subs are raving about! http://t.co/eaD6UiJ6nc $BAH $GLNG $AAP #trading
				
				
By  +Follow October 16, 2013 8:43AM
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