The Pep Boys – Manny, Moe and Jack – the nation’s leading automotive aftermarket service and retail chain, whose corporate office is located at the edge of East Falls, announced that it has entered into a definitive merger agreement under which it will be acquired by The Gores Group. The company is one of the nation’s leading investment firms, led by founder and CEO, Alec Gores.
Under the terms of the merger agreement, The Gores Group will acquire all of the outstanding common shares of Pep Boys for $15 per share in cash. This represents a premium of 24 percent over Pep Boys’ closing price of $12.08 on Jan. 27, 2012 and a premium of 36 percent over Pep Boys’ volume weighted average closing price over the last 30 trading days. Should the merger be approved by the shareholders, The Pep Boys will be privately owned and no longer traded on the New York Stock Exchange. The total enterprise value of the transaction is approximately $1 billion.
Pep Boys’ Board of Directors unanimously approved the merger agreement and recommended that Pep Boys’ shareholders approve the transaction. It is expected that Mike Odell, Pep Boys’ President & Chief Executive Officer and other members of the senior management team will continue in their roles with the company after the completion of the transaction.
Locally, The Pep Boys has been the funding source for the East Falls community’s East Falls Development Corp. since 2002. Under the guidance of then-4th District Councilman, Michael A. Nutter, The Pep Boys agreed to be the corporate component in the EFDC’s bid for funding through Philadelphia’s Business Privilege Tax Credit Community Development Program, a ten-year corporate/community development corporation partnership program conceived by Councilman Wilson Goode, Jr.
The Pep Boys has made that contribution for the past ten years. Hopefully, the new ownership will consider the value of continuing that partnership as well.