Pep Boys terminates Gores Group merger
It has been announced that a proposed merger between Pep Boys and The Gores Group has been terminated.
A proposed merger between Pep Boys and The Gores Group has been terminated, it has been announced.
Automotive aftermarket service and retail chain Manny, Moe and Jack confirmed after undertaking contract negotiation it has agreed to withdraw the proposed plans.
The Gores Group has agreed to pay Pep Boys $50 million (£32 million) and reimburse the company for a number of merger-related expenses.
Pep Boys' president and chief executive officer Mike Odell said: "This announcement does not alter our vision to be the automotive solutions provider of choice for the value-oriented customer."
He added that the firm's financial position is "solid" and the settlement proceeds will be used to pay down this year's term loan and refinance senior subordinated notes ahead of their 2013 and 2014 maturities.
Pep Boys recently announced expected sales of between $524 million and £526 million in its preliminary financial results for the first quarter of 2012.
Posted by David Gleck
Source: Pep Boys press release, May 29th