Japan’s Bridgestone to Acquire Pep Boys
The Bridgestone Corp. said it will pay $835 million to acquire auto parts retailer Pep Boys—a move that analysts say will expand the Japanese tire maker’s existing retail network in the U.S. by more than a third.
“Bridgestone is looking to expand its market share in services and tires. It’s a little harder to understand what they might do with [Pep Boys’] retail operations, but they’ll come up with a plan for it,” said Bret Jordan, an analyst with a New York-based investment advisory. The acquisition is expected to close in early 2016.
Bridgestone operates a chain of auto care and tire stores in the U.S., through its Bridgestone Retail Operations (BSRO) unit. The company’s U.S. business currently accounts for nearly half of its total global corporate sales.
The acquisition will add about 800 locations in 35 states to BSRO’s existing network of 2,200 tire and auto service centers in the U.S., which the company operates under the Firestone Complete Auto Care, Tires Plus, Hibdon Tires Plus, and Wheel Works brand banners.
Pep Boys, also known as Manny, Moe & Jack, was founded in 1921 by four friends who pooled together $800 to open an auto parts store in Philadelphia. The company has been on the block since June, when it said it was considering selling itself as part of a strategic review.
“Our shared expertise and commitment to our customers and employees will help us build an even stronger organization,” Gary Garfield, CEO and president of Bridgestone America, which is based in Nashville, Tennessee, said in a statement.