Québec-based Uni-Select, Canada’s largest supplier of automotive refinish, industrial paint and more than two million replacement parts in the auto industry, is being purchased by U.S.-based LKQ Corporation for approximately $2.8 billion in cash.
Based in Chicago, LKQ supplies aftermarket and recycled parts, focusing mainly on RVs, trucks and off-roading, towing, speed and performance, wheels, tires and performance handling.
Both companies operate in North America and the United Kingdom.
"This acquisition further enhances LKQ's global automotive vehicle parts distribution business," LKQ Corporation CEO Dominick Zarcone said in a statement. "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.
Uni-Select's FinishMaster division supplies paint and refinishing products to automotive dealerships, collision repair centres and fleet operators, mostly in the United States.
"We are also pleased that the acquisition will allow LKQ to build a significant presence in Québec, including Uni-Select's Boucherville, Québec head office, expanding upon LKQ's already existing business operations in that province,” Zarcone said.
Uni-Select CEO Brian McManus said the deal will combine the “complementary strengths” of the companies.
LKQ says FinishMaster “improves LKQ's scale and product mix to compete in this attractive and growing segment with minimal integration risk.”
The transaction price of $48 per share represents a premium of 19.2 per cent to Uni-Select's closing share price on Feb. 24, 2023. LKQ intends to fund the transaction through a combination of cash on hand and new debt.
The transaction, which needs shareholder approval, also requires antitrust clearances in Canada, the U.S. and the U.K. and approval under the Investment Canada Act.
In connection with the deal, LKQ says it will look to sell GSF Car Parts U.K., Uni-Select's U.K. based mechanical parts distribution business.
With files from the Canadian Press.
