Battle of the Billionaire Buyout

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Bridgestone Corp. is a multi-billion dollar company. So is Icahn Enterprises L.P., helmed by a billionaire himself, Carl Icahn. They are battling to buy Pep Boys-Manny, Moe & Jack.

And following its latest offer, Bridgestone is winning. The company’s Bridgestone Americas Inc. subsidiary and Pep Boys have agreed on amended terms to their Agreement and Plan of Merger dated Oct. 26, 2015, with Bridgestone offering $15.50 a share — equal to Icahn’s offer.

Specifically, Bridgestone Retail Operations LLC, itself a wholly owned subsidiary of Bridgestone Americas, increased the offer price to acquire all the outstanding shares of common stock of Pep Boys from $15 per share to $15.50 per share in cash, or approximately $863 million in aggregate equity value. The revised offer price of $15.50 per share provides approximately $28 million in additional cash consideration to Pep Boys shareholders.

The Pep Boys board of directors continues to unanimously recommend that Pep Boys shareholders accept Bridgestone’s offer and tender their shares pursuant to that offer. Pep Boys also announced that its board of directors no longer deems the proposal received on Dec. 8, 2015, from Icahn Enterprises to acquire Pep Boys for $15.50 per share in cash to be a “Superior Proposal” as defined in the Agreement and Plan of Merger.

The offer documents and Pep Boys’ solicitation/recommendation statement on Schedule 14D-9 will be amended to reflect the amended terms. The tender offer will expire at 5 p.m., New York City time, on Monday, Jan. 4, 2016, unless extended.

“The joining of Bridgestone and Pep Boys combines the expertise of nearly 200 years and a proud heritage in the American automotive aftermarket industry,” says T.J. Higgins, president of the U.S. and Canadian consumer tire business for Bridgestone Americas Tire Operations LLC.

“Both of our companies take immense pride in the skill of our employees, those in the bays and behind the counters of our stores. Bringing that technical talent together with our shared dedication to customer service will create a better, not just bigger, tire and automotive service retailer, and one that is positioned to best meet consumer needs.”

Bridgestone Retail’s nationwide network of 2,200 tire and automotive service centers operate under the Firestone Complete Auto Care, Tires Plus, Hibdon Tires Plus and Wheel Works brand banners. Along with these company-owned stores, Bridgestone sells tires through more than 5,000 long-standing dealers and distributors in the United States. The Pep Boys’ network of more than 800 locations in 35 states and Puerto Rico would represent an immediate expansion for Bridgestone, and accelerate the global growth strategy of Bridgestone Corp.

D.F. King & Co. Inc. is acting as information agent for Bridgestone in the tender offer. American Stock Transfer & Trust Co. LLC is acting as depositary and paying agent in the tender offer. J.P. Morgan Securities LLC is acting as dealer manager in the tender offer.

Requests for documents and questions regarding the tender offer may be directed to D.F. King & Co. Inc. by telephone at (212) 269-5550 or (866) 620-2536, or by email at pby@dfking.com. J.P. Morgan Securities LLC may be contacted by telephone at (877) 371-5947 or (212) 622-4401.

J.P. Morgan Securities LLC is acting as the exclusive financial advisor to Bridgestone. Jones Day is acting as legal advisor to Bridgestone. Rothschild is acting as the exclusive financial advisor to Pep Boys. Morgan, Lewis & Bockius LLP is acting as legal advisor to Pep Boys.

Source Modern Tire Dealer

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