Acquiring Stahlgruber for €1.5 billion for Entry into Germany
- LKQ is acquiring Stahlgruber GmbH for approximately €1.5 billion (LKQ’s largest ever acquisition), or 10x estimated 2017 EBITDA (net of €38 million in tax benefits and €20 million in estimated annual cost synergies);
- The acquisition will make LKQ 3x the size of its nearest competitor in Europe, provides LKQ entry into Germany (Europe’s largest automotive aftermarket), and creates a strategic hub for LKQ’s European operations, allowing for improved logistics;
- With Stahlgruber, LKQ’s collision-based business will drop to around 25% of the corporate total (from 33%);
- Stahlgruber could add 8 cents-to-10 cents to our 2018 EPS estimate depending on when the acquisition closes (expected late 1Q18/early 2Q18).
LKQ is a holding company. Through its subsidiaries, the company provides alternative vehicle collision replacement products and alternative vehicle mechanical replacement products. The company is also a provider of alternative vehicle replacement and maintenance products in the United Kingdom, Germany, the Benelux region (Belgium, Netherlands, and Luxembourg), Italy, Czech Republic, Poland, Slovakia, Austria, and other European countries. In addition to its wholesale operations, the company operates self service retail facilities across the United States that sell recycled automotive products from end-of-life-vehicles. The company is also a distributor of specialty vehicle aftermarket equipment and accessories.
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