Advance Auto Parts to acquire rival General Parts for $2.04 billion
Roanoke, Va. — Advance Auto Parts will acquire General Parts International, a privately held parts maker. The all-cash deal has an enterprise value of $2.04 billion.
Based in Raleigh, N.C., General Parts, which owns the Carquest brand, has 1,246 company operated stores in North America. It also operates 1,418 independently owned Carquest locations primarily in the United States and Canada.
The transaction will create the largest automotive aftermarket parts provider in North America, with annual sales of more than $9.2 billion and more than 70,000 employees. The combined company will be headquartered in Roanoke, Va., and will maintain a presence in Raleigh, N.C.
O. Temple Sloan III, president of General Parts, will continue to serve as president of the company. He will report to Darren Jackson, CEO of Advance Auto Parts, and is expected to join the Advance Auto Parts board of directors.
“This transformational transaction provides a compelling strategic opportunity for Advance to expand our geographic presence and commercial capabilities to better serve customers,” said Jackson. “The addition of 1,246 company-operated stores and 1,418 independently owned Carquest locations provides us with an immediate platform and scale across North America, full market coverage and the opportunity to position ourselves as the market leader in the commercial business. We believe the combination of the two companies is a great fit and the synergy of GPII’s assets with our capabilities will allow us to capitalize on market opportunities that will create value for our shareholders and provide even better service to our customers. We welcome and look forward to working with the talented leaders and team members from GPII.”
The transaction is subject to regulatory approvals and customary closing conditions and is expected to close by late 2013 or early 2014.
Former Walmart exec Mullany new president at Toys “R” Us
Toys “R” Us late Wednesday named Antonio Urcelay CEO and brought in former Walmart executive Hank Mullany to serve in the newly created role of president of U.S. stores.
Urcelay, 61, had served in an interim CEO capacity since May and has been with the company since 1996. Mullany, 55, most recently served as CEO of The ServiceMaster Company, a position he assumed after his effort in 2010to join CVS Caremark as president of the retail division was blocked for competitive reason by Walmart where Mullany had served as EVP and president of Walmart’s northern business unit.
“When we started this search, we were looking for a leader with global experience, deep retail knowledge, proven capabilities and outstanding leadership skills,” according to a statement by the Toys “R” Us board. “As the search progressed, we found exactly the right combination of these attributes in Antonio and Hank. Antonio’s extensive knowledge of global markets makes him uniquely qualified to lead the organization as we expand rapidly in Asia and other parts of the world. He has impressed all of us with his vision and leadership of the team throughout the search process. Hank brings a fresh perspective to the business, which, in combination with his operational strengths, will help build on the significant progress that has been made in advancing the U.S. business.”
Urcelay will continue to provide worldwide leadership in driving key strategies and growth initiatives in the company’s more than 1,500 stores in 36 countries and jurisdictions around the world, according to Toys “R” Us. Mullany in his new role will oversee all merchandising, marketing, ecommerce and store operations responsibilities for the 878 store U.S. division.
NPD Group releases holiday spending survey results
The NPD Group has released the results of its holiday spending survey, the 12th annual survey of consumers’ holiday spending intentions. According to the report, the majority of consumers intend to spend the same as or more than last year, with fewer saying they plan to spend less.
This year’s results found that 12% of U.S. consumers who were surveyed plan to spend more, while 67% said they plan to spend about the same and 21% said they plan to spend less.
“Consumers are feeling better about the economy compared to last year and they plan to take advantage of sales during key periods,” said Marshal Cohen, chief industry analyst, The NPD Group. “But this year’s holiday will be a tricky one for retailers. With fewer days between Thanksgiving and Christmas, Government distractions, and lack of newness in the marketplace, retailers will have to rely more on promotions to excite the consumer.”
Comparison shopping and comparing prices online remain consumers’ top pre-purchase actions. One-third of consumers plan to buy all of their holiday gifts on sale.
Consumers’ purchasing plans are similar to last year, with the same top 10 items on their holiday shopping list.
“With no new trendy items besides some updated versions of the same hot products from past years, consumers will not shop with fear due to lack of inventory. The must-have items will also be available at a wider variety of retailers, minimizing the panic shopping of years past,” said Cohen.
Overall, the holiday shopping season will get off to an earlier start compared to last year. According to the NPD Annual Holiday Spending Survey, this year more consumers have already started, or will start shopping before Thanksgiving.
“Consumers who plan to shop early expect the retailers to respond with extended store hours, and better deals offered earlier,” said Cohen.
The survey found that 17% of U.S. shoppers have already started their holiday shopping and 22% plan to start before Thanksgiving.
The online channel grew 5% compared to last year. High-income consumers, earning $75,000 or more, are likelier to shop this year on e-commerce sites. By comparison, other channels remained stable.
More than half (52%) of consumers surveyed said they plan on hitting discount stores, while 43% plan on shopping online. Twenty-nine percent of consumers plan to shop at national chains, 22% at department stores, 19% at toy stores, 18% at warehouse clubs, 17% at outlet stores, 17% at electronics stores, 15% at clothing specialty stores and 15% at off-price retailers.
“Researching online for the best deals will play a bigger role this year with social media continuing to influence consumers’ holiday purchases,” said Cohen. “The expansion of Black Friday weekend deals will also be a major player in the discount offerings. Look for promotions to start well ahead of Black Friday to create a much greater consumer opportunity for stores and online.”