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Bain Makes $1.83 Billion Offer For Struggling Oz Auto Parts Business Bapcor

Bapcor (Image: Sourced from Bapcor website)

In a statement issued to the ASX on Tuesday, Australian auto parts business Bapcor confirmed that it had received an “unsolicited” proposal from Bain Capital Private Equity to acquire 100 per cent of its shares.

It said that under the “indicative, conditional, and non-binding” offer which it received from Bain after the sharemarket closed on June 7, the PE firm would pay Bapcor shareholders $5.40 per share. That figure would make the buyout a A$1.83 billion proposal.

Although Bapcor’s share price has climbed around 20 per cent since June 7 to $5.11 as of midday on June 12, the company has cautioned that it hasn’t yet decided on whether to accept the offer.

“The Board cautions that at this time there is no guarantee that the indicative proposal put forward by Bain Capital will result in a binding offer or that any transaction will eventuate,” noted the statement.

Bapcor (Image: Sourced from Bapcor website)

Bapcor runs the Autobarn, Autopro, Burson and Midas chains and has 1,100 outlets selling car parts.

Noel Meehan, who informed Bapcor’s board of his decision to step down as the company’s CEO earlier this year citing personal and family reasons, had previously enlisted McKinsey & Company to help with a turnaround strategy. The Better Than Before programme he oversaw was designed to deliver $100 million in extra profits by 2025.

Instead, Bapcor downgraded profit expectations thrice in the past year itself.

The last time it did so was in May. When the announcement was made, its shares plummeted 35 per cent in a day, wiping out more than $500 million in sharemarket value.

Bapcor has struggled with losing ground to the likes of Super Retail Group and Repco.

For the latest takeover bid from Bain, Bapcor has enlisted Macquire Capital as its financial advisor and Allens as its legal advisor.

Bain in Australia owns Virgin Australia, as well as aged care home operator Estia Health and is also a major player in a consortium that has taken ownership of Australia’s second-largest wine group Accolade Wines.

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