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
Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive
aftermarket parts provider in North America that serves both
professional installer and do-it-yourself customers, announced that
it has entered into a definitive agreement to sell Worldpac, Inc.,
an automotive parts wholesale distribution business, to funds
managed by global investment firm Carlyle (NASDAQ: CG) for $1.5
billion in cash. The transaction is expected to close before the
end of the year.
“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 ~$13 billion in industrial carve-outs over
the past two decades, including in such companies as Axalta,
Nouryon, Atotech, Signode, and Allison Transmission.
Transaction Details
- Over the last twelve months, at the end of the second quarter
of 2024, the Worldpac business generated approximately $2.1 billion
in revenue and approximately $100 million in EBITDA.
- Advance expects net proceeds of approximately $1.2 billion
after taxes and transaction fees.
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 the United
States, with additional locations in Canada, Puerto Rico and the
U.S. Virgin Islands. The company also served 1,138 independently
owned Carquest branded stores across these locations in addition to
Mexico and various Caribbean islands. Additional information about
Advance, including employment opportunities, customer services, and
online shopping for parts, accessories and other offerings can be
found at www.AdvanceAutoParts.com.
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
$435 billion of assets under management as of June 30, 2024,
Carlyle's purpose is to invest wisely and create value on behalf of
its investors, portfolio companies and the communities in which we
live and invest. Carlyle employs more than 2,200 people in 29
offices across four continents. Further information is available at
www.carlyle.com. Follow Carlyle on X @OneCarlyle and LinkedIn at
The Carlyle Group.
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
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