American automotive aftermarket retailer Advance Auto Parts (AAP) is set to purchase a US-based auto parts maker General Parts International for $2.04bn in cash.
This deal will create the largest automotive replacement parts provider in North America.
General Parts is a distributor and supplier of original equipment and aftermarket replacement products for commercial markets operating under the Carquest and Worldpac brands.
As part of the deal, AAP will gain ownership of 1,246 company-owned Carquest stores and another 1,418 franchised locations in the US and Canada. AAP currently has 4,018 stores throughout the US.
The newly formed entity will be based in Roanoke, Virginia, and will continue to have a presence in Raleigh, North Carolina.
AAP expects to increase its earnings by over 20% with this deal. The deal is expected to close by early 2014.
"This transformational transaction provides a compelling strategic opportunity for Advance to expand our geographic presence and commercial capabilities to better serve customers," CEO Darren Jackson said in a statement.
Besides this, AAP has completed the acquisition of 124 stores of BWP distributors through an all-cash transaction in January 2013.