LKQ Corp. and The Coast Distribution System Inc. today (July 9) announced that they have signed a definitive agreement for LKQ to acquire Coast for $5.50 per share in cash. LKQ is parent to Keystone Automotive Operations Inc. and NTP-Stag.
According to a news release, Coast is a leading distributor of replacement parts, supplies and accessories for recreational vehicles primarily to retail parts and supplies stores, service and repair establishments, and new and used RV dealers in North America. Under the terms of the definitive agreement, a subsidiary of Chicago-based LKQ will commence a tender offer to acquire all outstanding shares of Coast’s common stock for $5.50 per share in cash. The tender offer is required to be commenced within 10 business days and to remain open for at least 20 business days after launch.
The acquisition is currently expected to close in the third quarter of 2015.
Coast’s board has unanimously recommended that Coast stockholders accept the offer and tender their shares. Total cash consideration payable for Coast’s outstanding shares is approximately $29 million. As of June 30, Coast had $19.5 million outstanding under its long-term revolving bank line of credit.
“The combination of Coast with our specialty segment and RV business presents tremendous distribution and logistics synergies with our existing network, and expands our RV business with the addition of unique product offerings and brands,” stated Robert L. Wagman, president and CEO of LKQ Corp.
LKQ announced its planned acquisition in December of 2013 of Keystone Automotive Operations Inc., parent to NTP, a key distributor to the RV industry. That news was followed by Keystone’s acquisition of Stag-Parkway, the nation’s largest distributor of RV aftermarket parts and accessories, in October of 2014. The companies were subsequently merged, creating NTP-Stag.