From Tire Review
Pep Boys’ board of directors, together with a team of lawyers, have determined that Icahn Enterprises’ offer to purchase the company for $15.50 a share is indeed a “Superior Proposal” as defined in the company’s merger agreement with Bridgestone Retail Operations.
The board notified Bridgestone on Dec. 8 of its determination and intention to effect a change of recommendation and terminate its agreement with the tiremaker. Pep Boys’ notice to Bridgestone opens a three-day period, expiring 5 p.m. Eastern time on Dec. 11, during which Pep Boys can’t change its recommendation or terminate its agreement with Bridgestone. During this time, Bridgestone has the right to resubmit proposals for acquiring Pep Boys.
“We at Bridgestone Americas are excited about the progress made thus far toward finalizing our company’s acquisition of Pep Boys in early 2016. We have received notice that the Pep Boys board of directors has determined that another proposal is superior to ours. Under the terms of the merger agreement, Bridgestone has three business days to negotiate with Pep Boys to amend the merger agreement in response to such proposal,” a Bridgestone spokesperson told Tire Review. “We continue to believe that the joining of Bridgestone and Pep Boys, with nearly 200 years of experience in the American automotive aftermarket industry between us, is good for the combined business, offers more diverse career opportunities for employees across a larger company and provides customers with a broad range of the world-class products and services they want, when and where they need them. Any further decisions will be made based on what continues to make business and financial sense for Bridgestone and aligns with our long-term growth strategy.”
There is no assurance that a transaction with Icahn will happen and that Bridgestone will propose any adjustments to its previous offer, Pep Boys said in a release.
Bridgestone entered into an agreement in October to purchase Pep Boys for $15 a share. On Nov. 16, the tiremaker commenced its tender offer of the parts retailer.
