The Pep Boys, a US automotive aftermarket service and retail chain, decided that the proposal from Icahn Enterprises L.P. to acquire Pep Boys for US$15.50 per share in cash constitutes a “Superior Proposal” as defined in the Company’s agreement and plan of merger with Bridgestone Retail Operations, LLC.
As part of its proposal, Icahn delivered to the Company a merger agreement signed by Icahn that is not subject to due diligence or financing conditions and contains a “hell or high water” anti-trust covenant.
Also on December 8, 2015, the Company delivered notice to Bridgestone of the Pep Boys Board’s determination and intention to effect a change of recommendation and to terminate the Bridgestone agreement. Such notice commenced a three business day period that will expire at 5:00pm New York City time, on Friday December 11, 2015, during which the Company may not change the recommendation nor terminate the Bridgestone agreement, and Bridgestone has the right to make proposals to the Company.
As previously announced on October 26, 2015, the Company entered into the Bridgestone agreement pursuant to which Bridgestone commenced, on November 16, 2015, a tender offer for all outstanding shares of Pep Boys at US$15.00 per share in cash.
There can be no assurance that a transaction with Icahn will result or that Bridgestone will propose any adjustments to the Bridgestone agreement. The Pep Boys Board has not changed its recommendation with respect to the Bridgestone transaction, nor has it made any recommendation with respect to the Icahn proposal.