LKQ Corporation to buy Canadian automotive group Uni-Select for $2.1bn

LKQ Corporation, a US auto equipment supplier, has agreed to acquire Canada-based Uni-Select for an enterprise value of around C$2.8 billion ($2.1 billion), marking scaled entry into mechanical parts space in North America.

The transaction complements LKQ’s current North American paint distribution operations and will drive the company’s business and growth.

LKQ anticipates the transaction to generate around $55 million run-rate cost synergies by the third year following closing and incremental revenue upside opportunities.

Uni-Select distributes automotive refinish and industrial coatings and related products in North America and automotive aftermarket parts in Canada and in the UK.

Dominick Zarcone — LKQ Corporation President and CEO said: “This acquisition further enhances LKQ’s global automotive vehicle parts distribution business.

“Uni-Select’s North American automotive refinish paint and mechanical parts distribution operations complement LKQ’s existing footprint and will allow us to distribute a broader array of products to our customers.

“We are also pleased that the acquisition will allow LKQ to build a significant presence in Québec, including Uni-Select’s Boucherville, Québec head office, expanding upon LKQ’s already existing business operations in that province.”

With 15 distribution centers and more than 400 branches, Uni-Select employs more than 5,200 people and serves more than 70,000 customers yearly across the UK, the US, and Canada.

Brian McManus — Uni-Select Executive Chair and CEO said: We see great opportunities to benefit our customers, employees, suppliers and brands by combining our complementary strengths within the larger, multi-disciplinary and growing LKQ team.”

LKQ plans to fund the acquisition through a combination of cash on hand and new debt, with bridge financing commitments from Bank of America and Wells Fargo.

The company will divest Uni-Select’s UK-based mechanical parts distribution business GSF Car Parts U.K., as part of the deal.

The acquisition is expected to close in the second half of 2023, subject to certain customary closing conditions.