Icahn Enterprises to Sell Pep Boys to Mavis Tire for $700M Cash
IEP is trading near its 52-week low of $7.08 (8.7% above the low).
Summary
Icahn Enterprises agreed to sell Pep Boys to Mavis Tire for $700 million in cash, retaining owned real estate and two other auto service brands. The deal is expected to close in the coming months.
Key Events · M&A and Partnerships · IEP
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Pep Boys Sold for $700M Cash
Icahn Enterprises entered into a definitive agreement to sell its Pep Boys subsidiary to Mavis Tire for a base purchase price of $700 million in cash, subject to customary adjustments.
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IEP Retains Real Estate and Other Brands
IEP will keep the owned real estate previously transferred from Pep Boys, as well as the AAMCO Transmissions and Precision Tune Auto Care businesses, which are not part of the sale.
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Reverse Termination Fee Protects IEP
If Mavis fails to close due to breach or repudiation, Mavis must pay IEP a $21 million reverse termination fee, providing downside protection.
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Deal Expected to Close in Coming Months
The transaction is subject to customary closing conditions and regulatory approvals, with closing anticipated in the coming months.
Analysis · IEP · Energy & Transportation
Icahn Enterprises is selling its Pep Boys auto-service chain to Mavis Tire for $700 million in cash, a deal that will significantly reshape IEP's portfolio. The transaction includes a $21 million reverse termination fee if Mavis fails to close, and IEP will retain Pep Boys' owned real estate along with the AAMCO and Precision Tune businesses. This sale follows a period of mixed financial performance and leadership changes at IEP, and the cash proceeds could strengthen the balance sheet or fund distributions to unitholders.
At the time of this filing, IEP was trading at $7.70 on NASDAQ in the Energy & Transportation sector, with a market capitalization of approximately $5.1B. The 52-week trading range was $7.08 to $9.75. This filing was assessed with positive market sentiment and an importance score of 8 out of 10.