Dive Brief:
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As expected, Bridgestone Retail Operations, the U.S. subsidiary of Japanese tire company Bridgestone, has raised its takeover bid to $15.50 or $863 million to match an offer from activist investor Carl Icahn.
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Icahn had disclosed last week that he’d acquired one-eighth of Pep Boys' stock and that he wants the company to sell its 800 or so retail stores to his own Auto Plus chain.
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Kurume, Japan-based Bridgestone Corp.’s subsidiary, which owns more than 2,200 tire and automotive centers and has more than 5,000 dealers and distributors in the U.S., had agreed in October to buy the Pep Boys auto-parts chain for about $835 million. A merger with Pep Boys would create the largest auto service and supplies retailer in the world.
Dive Insight:
Pep Boys seems determined to be acquired by Bridgestone, with its board unanimously recommending that shareholders accept Bridgestone’s new offer and saying it “no longer deems [Icahn’s offer] to be a ‘superior proposal’ as defined in Agreement and Plan of Merger.”
Meanwhile, Bridgestone also seems determined to acquire the U.S. chain, saying an acquisition of Pep Boys “represents an immediate expansion.”
Pep Boys shares rose at the prospect of a bidding war and were down slightly as the war appeared to subside with Bridgestone’s new bid.
