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Letter to the Editor
Monday June 20
Boyd Group Acquires Cars Collision Centers
The Boyd Group Income Fund has entered into a definitive agreement to acquire Cars Collision Center of Colorado, LLC and Cars Collision Center, LLC, which own a total of 28 collision repair centers in the U.S. states of Illinois, Indiana, and Colorado."We are very pleased with the planned acquisition of Cars, as we continue to execute on our stated strategy of growing our business," said Brock Bulbuck, President and Chief Executive Officer of the Boyd Group. "By our estimates, the acquisition will position Boyd as the largest multi-location collision operator in North America not only in terms of number of locations, but also in terms of annual sales. After completing this transaction, Boyd will have a total of 164 collision repair centers across 13 U.S. states and four Canadian provinces. We expect to see substantial benefits from the transaction, including expanded critical mass and presence in one of our key markets, an expanded national footprint which translates into enhanced value to our U.S. insurance company clients, as well as additional synergies. We are confident that the similarities between the business models of Boyd and Cars, as well as each company's vision for the future, will result in an excellent strategic fit. While we are continuing our growth strategy of adding eight to 13 new locations per year, this acquisition represents a unique and attractive opportunity to acquire another strategic multi-location repair business and achieve accelerated growth."
The transaction, valued at approximately US$21 million, is expected to be completed by July 1, 2011, subject to certain closing conditions being fulfilled. Funding for the transaction will be through a combination of cash, U.S. bank debt, third-party financing, and a seller take-back note. The Fund will not be issuing any new equity to fund the transaction and, therefore, the transaction will not result in equity dilution to unitholders. BB&T Capital Markets served as financial advisor to the Boyd Group in the transaction.
Cars is a private company that operates 14 locations in Illinois, eight locations in northern Indiana, and six locations in Colorado. It generated sales of approximately US$65 million in the 12 months ended April 30, 2011. Subsequent to the acquisition, Boyd will have a total of 45 locations in the Chicagoland market, up from 23.
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