Advance Auto Parts Announces Sale of Worldpac to Carlyle for $1.5 Billion
Advance Auto Parts (NYSE: AAP) has announced the sale of its Worldpac subsidiary to Carlyle (NASDAQ: CG) for $1.5 billion in cash. The transaction, expected to close by year-end, aims to simplify Advance's structure and focus on its core blended box business. Net proceeds of approximately $1.2 billion will be used to strengthen the balance sheet and invest in the business.
Worldpac, an automotive parts wholesale distribution business, generated $2.1 billion in revenue and $100 million in EBITDA over the last twelve months. The sale is part of Advance's strategic review to improve productivity and position the company for future growth. Carlyle views this acquisition as an opportunity to leverage its experience in industrial carve-outs, having invested ~$13 billion in similar transactions over the past two decades.
Advance Auto Parts (NYSE: AAP) ha annunciato la vendita della sua sussidiaria Worldpac a Carlyle (NASDAQ: CG) per 1,5 miliardi di dollari in contanti. La transazione, prevista per chiudere entro la fine dell'anno, mira a semplificare la struttura di Advance e a concentrarsi sul suo core business delle scatole miste. I proventi netti di circa 1,2 miliardi di dollari saranno utilizzati per rafforzare il bilancio e investire nell'azienda.
Worldpac, un’azienda di distribuzione all'ingrosso di parti automobilistiche, ha generato 2,1 miliardi di dollari di fatturato e 100 milioni di dollari di EBITDA negli ultimi dodici mesi. La vendita fa parte della revisione strategica di Advance per migliorare la produttività e posizionare l'azienda per una crescita futura. Carlyle considera questa acquisizione come un'opportunità per sfruttare la propria esperienza nelle operazioni di carve-out industriali, avendo investito circa 13 miliardi di dollari in transazioni simili negli ultimi due decenni.
Advance Auto Parts (NYSE: AAP) ha anunciado la venta de su subsidiaria Worldpac a Carlyle (NASDAQ: CG) por 1.5 mil millones de dólares en efectivo. Se espera que la transacción se cierre para fin de año, con el objetivo de simplificar la estructura de Advance y enfocarse en su negocio central de cajas mixtas. Los ingresos netos de aproximadamente 1.2 mil millones de dólares se utilizarán para fortalecer el balance y reinvertir en el negocio.
Worldpac, un negocio de distribución mayorista de partes automotrices, generó 2.1 mil millones de dólares en ingresos y 100 millones de dólares en EBITDA durante los últimos doce meses. La venta es parte de la revisión estratégica de Advance para mejorar la productividad y posicionar a la empresa para el crecimiento futuro. Carlyle ve esta adquisición como una oportunidad para aprovechar su experiencia en carve-outs industriales, habiendo invertido aproximadamente 13 mil millones de dólares en transacciones similares durante las últimas dos décadas.
어드밴스 오토 파츠(뉴욕증권거래소: AAP)는 자회사 월드팩을 카라이일(내셔널주식거래소: CG)에 15억 달러 현금으로 판매한다고 발표했습니다. 이 거래는 연말까지 마무리될 것으로 예상되며, 어드밴스의 구조를 간소화하고 혼합 박스 비즈니스에 집중하기 위한 것입니다. 약 12억 달러의 순수익은 재무 상태를 강화하고 사업에 투자하는 데 사용될 것입니다.
자동차 부품 도매 유통업체인 월드팩은 지난 12개월 동안 21억 달러의 수익과 1억 달러의 EBITDA를 기록했습니다. 이번 판매는 어드밴스의 생산성을 개선하고 미래 성장을 위한 회사의 포지셔닝을 위한 전략적 검토의 일환입니다. 카라이일은 이 인수를 산업 카브아웃에 대한 경험을 활용할 기회로 보고 있으며, 지난 20년 동안 비슷한 거래에 약 130억 달러를 투자했습니다.
Advance Auto Parts (NYSE: AAP) a annoncé la vente de sa filiale Worldpac à Carlyle (NASDAQ: CG) pour 1,5 milliard de dollars en espèces. La transaction, qui devrait se clôturer d'ici la fin de l'année, vise à simplifier la structure d'Advance et à se concentrer sur son activité principale de boîtes mélangées. Les produits nets d'environ 1,2 milliard de dollars seront utilisés pour renforcer le bilan et investir dans l'entreprise.
Worldpac, un distributeur en gros de pièces automobiles, a généré 2,1 milliards de dollars de chiffre d'affaires et 100 millions de dollars d'EBITDA au cours des douze derniers mois. La vente fait partie de l'examen stratégique d'Advance pour améliorer la productivité et positionner l'entreprise pour une croissance future. Carlyle considère cette acquisition comme une opportunité de tirer parti de son expérience dans les carve-outs industriels, ayant investi environ 13 milliards de dollars dans des transactions similaires au cours des deux dernières décennies.
Advance Auto Parts (NYSE: AAP) hat den Verkauf seiner Tochtergesellschaft Worldpac an Carlyle (NASDAQ: CG) für 1,5 Milliarden Dollar in bar angekündigt. Die Transaktion, die bis Ende des Jahres abgeschlossen sein soll, zielt darauf ab, die Struktur von Advance zu vereinfachen und sich auf das Kerngeschäft mit gemischten Boxen zu konzentrieren. Der Nettogewinn von etwa 1,2 Milliarden Dollar wird zur Stärkung der Bilanz und zur Investition in das Geschäft verwendet.
Worldpac, ein Großhandelsvertrieb für Automobilteile, erzielte in den letzten zwölf Monaten 2,1 Milliarden Dollar Umsatz und 100 Millionen Dollar EBITDA. Der Verkauf ist Teil von Advances strategischer Überprüfung zur Verbesserung der Produktivität und zur Positionierung des Unternehmens für zukünftiges Wachstum. Carlyle sieht diesen Erwerb als Gelegenheit, seine Erfahrung mit Industrie-Carve-outs zu nutzen, nachdem es in den letzten zwei Jahrzehnten etwa 13 Milliarden Dollar in ähnliche Transaktionen investiert hat.
- Sale of Worldpac for $1.5 billion in cash, providing significant liquidity
- Expected net proceeds of $1.2 billion after taxes and transaction fees
- Simplification of Advance's enterprise structure
- Opportunity to focus on turnaround of core blended box business
- Improved financial flexibility for future growth and value creation
- Divestiture of a profitable business unit (Worldpac) that generated $2.1 billion in revenue
- Potential loss of synergies and market presence in the wholesale distribution segment
- Reduction in overall company size and revenue stream
Insights
The sale of Worldpac to Carlyle for
However, divesting a business that generated
This divestiture signals a strategic pivot for Advance Auto Parts, potentially in response to changing market dynamics in the automotive aftermarket sector. By selling Worldpac, AAP is likely aiming to streamline its operations and focus on its core competencies. This move could be seen as a proactive step to address challenges in the highly competitive auto parts industry.
The transaction's impact on AAP's market position and competitive landscape will be important to watch. Investors should pay attention to how this sale affects AAP's relationship with professional installers, a key customer segment for Worldpac. Additionally, the company's ability to execute its turnaround strategy for the "blended box business" will be critical in determining the long-term value of this decision.
The sale of Worldpac to Carlyle appears to be a clean transaction from a legal perspective. Key points to note:
- The deal is structured as a cash transaction, which typically simplifies the closing process.
- The expected closing timeline (before year-end) suggests confidence in obtaining necessary regulatory approvals.
- Advance Auto Parts has engaged reputable advisors (Centerview Partners and Hogan Lovells), indicating thorough due diligence and deal structuring.
Investors should be aware that complex carve-outs can sometimes lead to transitional service agreements or ongoing obligations. It would be prudent to review any post-closing commitments AAP might have to Worldpac or Carlyle once more details are available.
Sale simplifies Advance’s enterprise structure and sharpens focus on the blended box business
Net proceeds to be used primarily to strengthen balance sheet and invest in the business
“We are pleased to announce the sale of the Worldpac business,” said Shane O’Kelly, president and chief executive officer. "The sale enables our team to sharpen their focus on decisive actions to turn around the Advance blended box business. Proceeds from the transaction will provide greater financial flexibility as we continue our strategic and operational review to improve the productivity of the company’s remaining assets and better position the company for future growth and value creation. On behalf of everyone at Advance, I would like to thank the more than 5,000 Worldpac team members for their dedication over the last ten years.”
"We are excited to partner with Worldpac, a great business operating in attractive markets," said Wes Bieligk, a Partner, and Katherine Barasch, a senior member of Carlyle's Global Industrials investing team. "Our proven track record in executing complex carve-outs position us uniquely to support Worldpac and its team as an independent company." Carlyle's investment in Worldpac builds on the firm's extensive carve-out experience in the Industrials sector, having invested
Transaction Details
-
Over the last twelve months, at the end of the second quarter of 2024, the Worldpac business generated approximately
$2.1 billion $100 million -
Advance expects net proceeds of approximately
$1.2 billion
Centerview Partners is serving as financial advisor and Hogan Lovells US, LLP, is serving as legal advisor to Advance on the transaction. BofA Securities is acting as lead financial advisor to Carlyle and BMO Capital Markets is also acting as a financial advisor to Carlyle. Latham & Watkins is serving as legal advisor to Carlyle.
Investor Conference Call
As previously announced, the company has scheduled a webcast to begin at 8 a.m. Eastern Time today, to discuss results for the second quarter ended July 13, 2024. During the webcast, the company will provide additional information on the Worldpac transaction. The webcast will be accessible via the Investor Relations page of the company's website (ir.AdvanceAutoParts.com).
About Advance Auto Parts
Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installers and do-it-yourself customers. As of July 13, 2024, Advance operated 4,776 stores and 321 Worldpac branches primarily within
About Carlyle
Carlyle (NASDAQ: CG) is a global investment firm with deep industry expertise that deploys private capital across its business and conducts its operations through three business segments: Global Private Equity, Global Credit and Global Investment Solutions. With
Forward-Looking Statements
Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast, “guidance,” “intend,” “likely,” “may,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “should,” “strategy,” “will,” or similar language. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements about the sale of Worldpac, including statements regarding the benefits of the sale and the anticipated timing of closing, the expected use of proceeds and expectations for economic conditions, future business and financial performance, as well as statements regarding underlying assumptions related thereto. Forward-looking statements reflect the company’s views based on historical results, current information and assumptions related to future developments. Except as may be required by law, the company undertakes no obligation to update any forward-looking statements made herein. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. They include, among others, the company’s ability to hire, train and retain qualified employees, the timing and implementation of strategic initiatives, deterioration of general macroeconomic conditions, geopolitical conflicts, the highly competitive nature of the industry, demand for the company’s products and services, the company’s ability to consummate the sale of Worldpac on a timely basis or at all, including failure to obtain the required regulatory approvals or to satisfy the other conditions to the closing, the company’s use of proceeds and ability to maintain credit ratings, access to financing on favorable terms, complexities in the company’s inventory and supply chain and challenges with transforming and growing its business. Please refer to “Item 1A. Risk Factors” of the company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), as updated by the company's subsequent filings with the SEC, for a description of these and other risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240821115120/en/
Investor Relations Contact:
Lavesh Hemnani
T: (919) 227-5466
E: invrelations@advanceautoparts.com
Media Contacts:
Darryl Carr
T: (984) 389-7207
E: AAPCommunications@advance-auto.com
Carlyle
Brittany Berliner, (212) 813-4839
Brittany.Berliner@carlyle.com
Source: Advance Auto Parts, Inc.
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