After more than two months of bidding, Pep Boys will finally get a new owner. Pep Boys agreed to be acquired by investor Carl Icahn’s company, Icahn Enterprises, for $1.03 billion in cash, or $18.50 per share. Bridgestone Americas, which had been the opposing party intent on purchasing Pep Boys, dropped out of the bidding after the holding company increased its offer.
Earlier in December, Pep Boys agreed to be acquired by Bridgestone Americas for $863 million, or $15.50 per share. The Pep Boys Board of Directors determined that Icahn’s proposal to purchase the company for $18.50 per share was “superior” to the Bridgestone deal in place.
As part of the agreement, Icahn Enterprises, on behalf of Pep Boys, paid Bridgestone a $39.5 million termination fee.
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Upon receiving the offer from Icahn, Pep Boys initially delivered a notice giving Bridgestone until 5 pm EST on Dec. 31 to make another offer or officially terminate their agreement.
The acquisition closes the back-and-forth jostling between Icahn Enterprises and Bridgestone, as both entities made multiple bids to acquire the assets of Pep Boys. Bridgestone first agreed to buy Pep Boys for approximately $835 million in cash, or $15 per share, in October 2015. Icahn then upped the ante to $15.50 per share, initially causing Pep Boys to back out of the deal. In response, Bridgestone then matched the offer and agreed to another tentative deal. On Dec. 24, the parties announced that the price per share had been increased to $17.00.
