Uni-Select (TSX:UNS) shares soared in Monday’s early deals as Chicago-headquartered LKQ Corporation (NASDAQ:LKQ) struck a deal to buy the Canadian car parts and paint distributor for US$2.8bn.
Shareholders will receive US$48 in cash for every Uni-Select (TSX:UNS) share they hold through the deal, which remains subject to shareholder approval and anti-trust clearance in the US, Canada and the UK.
LKQ is expected to seek the sale of certain business interests in the UK in connection with the transaction – specifically the GSF Car Parts UK, which is a parts distributor in the UK.
Uni-Select (TSX:UNS) has some 5,200 employees working across a network of 15 distribution centers and over 400 branches.
Brian McManus, Uni-Select chief executive, told investors that the deal offers compelling value and liquidity.
LKQ chief executive Dominick Zarcone, meanwhile, in a statement said: “This acquisition further enhances LKQ’s global automotive vehicle parts distribution business.
“Uni-Select’s North American automotive refinish paint and mechanical parts distribution operations complement LKQ’s existing footprint and will allow us to distribute a broader array of products to our customers.
“We look forward to welcoming Uni-Select’s employees to the LKQ team. Importantly, we believe that our combined efforts will create tremendous long-term value for our customers, shareholders, employees, and other stakeholders as we continue to focus on our operational excellence initiatives.”
Uni-Select shares rose 16% to trade at US$46.76 per share in Monday morning’s deals whilst LKQ shares nudged slightly higher at US$57.67 per share.