According to Bloomburg.com, O’Reilly Automotive Inc.., the third- biggest U.S. auto-parts chain, agreed to buy CSK Auto Corp. for $528 million after a yearlong attempt to take over the Phoenix- based retailer. The acquisition of the ailing auto-parts chain made headlines Tuesday.
Bloomburg.com reports that O’Reilly will also assume about $500 million of CSK’s debt. CSK gave in to O’Reilly after rejecting the parts chain’s advances since March last year. O’Reilly made its intentions public in February with an $8-a-share unsolicited offer. CSK has been seeking a buyer since hiring JPMorgan Chase & Co. as an adviser in December. Even though the acquisition is no surprise to many, it is good news for investors.
The Bloomburg.com article reports that the combined company will have about 3,200 stores and revenue of about $4.4 billion based on 2007 totals. O’Reilly said the purchase will add ˜modestly to earnings in 2009. Cost savings may be $100 million annually beginning in 2010.”
CSK runs stores under several brand names, including Checker Auto Parts, Schucks Auto Supply, Kragen Auto Parts, Murrays Discount Auto Stores, and AutoZone, Inc. There is as of yet no report on the effect this acquisition will have on the price of auto parts, a major concern for those who do their own repair work.
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According to CSK Auto, Inc., Following the close of the transaction, O’Reilly will be the third largest national auto parts retailer with approximately 3,200 stores located across the United States.
Read the rest of this story by freelance writer Kate Miller Wilson on our exotic car rental news page.
