Bridgestone to buy Pep Boys

Pep Boys stores do not carry Bridgestone or Firestone brands. The company's brand portfolio comprises BFGoodrich, Carlisle, Continental, Cooper, Falken, General, Hankook, Maxxis, Michelin, Mickey Thompson and Pirelli, plus its own proprietary Definity and Futura brands; Cooper makes Pep Boys' private brands.

The transaction is expected to close in the beginning of 2016. Under the terms of the agreement, which has been approved unanimously by the boards of both Bridgestone and Pep Boys, a wholly owned subsidiary of Bridgestone Retail Operations will commence a tender offer for all outstanding shares of Pep Boys at $15 per share in cash.

The completion of the tender offer will be conditioned on Pep Boys' shareholders tendering at least a majority of Pep Boys' outstanding shares, determined on a fully diluted basis, and other customary closing conditions, including expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.

Following completion of the tender offer, both companies will complete a merger in which Pep Boys shares that were not tendered in the tender offer will be cancelled and converted into the right to receive $15 per share in cash. Following completion of the transaction, Pep Boys will be wholly owned by and operate under Bridgestone Retail Operations (BSRO).

Pep Boys' stock will no longer trade on the New York Stock Exchange.

J.P. Morgan Securities L.L.C. is acting as the exclusive financial adviser to Bridgestone. Jones Day is acting as legal adviser to Bridgestone. Rothschild is acting as the exclusive financial adviser to Pep Boys and Morgan, Lewis & Bockius L.L.P. is acting as legal adviser to the chain.

For a Pep Boys press release on the acquisition, click here.