Genuine Parts Co. is acquiring Alliance Automotive Group (AAG), the second largest parts distribution company in Europe, in a $2 billion deal.
Genuine Parts, which distributes parts in the U.S. under the NAPA Auto Parts brand, will acquire AAG from private equity funds managed by Blackstone and AAG's co-founders. The acquisition includes the repayment of AAG's outstanding debt upon closing.
The transaction has been approved by the Genuine board of directors and is expected to close in the fourth quarter of 2017.
AAG focuses on light vehicle and commercial vehicle replacement parts. Headquartered in London, the company has 7,500 employees and more than 1,800 company-owned stores and affiliated outlets across France, the U.K. and Germany.
AAG is expected to generate $1.7 billion of revenue on a U.S. GAAP basis in 2017.
Paul Donahue, CEO and president of Genuine Parts, says "We are excited to combine with AAG and enter the European markets with critical scale and a leading market position in the automotive aftermarket. AAG is poised to contribute significant sales growth and earnings accretion to Genuine Parts Company and also serves to enhance the GPC platform for long-term, sustainable expansion across the global automotive parts industry.
Jean-Jacques Lafont, Chairman, CEO and co-founder of AAG, says, "We are very pleased to combine our two great businesses and leverage our collective resources and expertise to accelerate growth. AAG's success is a testament to the hard work and dedication of our wonderful employees, without whom this transaction would not be possible. I am confident that, together, we will achieve great things and continue to provide the highest quality parts and service to our combined customers across the globe."
Lionel Assant, the head of Blackstone's European private equity says, "Over the past three years, AAG has experienced tremendous growth and transformed into one of Europe's leading automotive parts distributors. We have no doubt that the business will go on to further growth under Genuine Parts Company, which is the right partner to support AAG's continued success."