- Breeze Autocare is a strong operator of nearly 200 stores
primarily operated under the Oil Changers brand across 17
states
- Allows Valvoline to build scale and more quickly expand its
presence in strategic markets
- Expected to deliver top line sales and profit growth and
enhance an already strong cash flow profile
- The purchase price of approximately $625
million represents a multiple of 10.7 times Breeze
Autocare's adjusted EBITDA1
- Transaction expected to close in fiscal Q3 2025
LEXINGTON, Ky., Feb. 20,
2025 /PRNewswire/ -- Valvoline Inc. (NYSE: VVV), the
quick, easy, trusted leader in preventive automotive maintenance,
today announced that it has signed a definitive agreement to
acquire Breeze Autocare from Greenbriar Equity Group, a middle
market private equity firm. Breeze Autocare is a strong operator of
nearly 200 stores across 17 states, predominantly under the Oil
Changers brand. Valvoline will acquire the business for
approximately $625 million in cash,
which Valvoline intends to fund with a newly issued Term Loan
B.
Breeze Autocare is an independent provider of automotive quick
lube and other preventive maintenance services with an extensive
footprint of company-owned stores across California, Texas, and the Midwest. With a strong, proven
track record of growth, including organic same-store-sales growth
and store additions, Breeze Autocare generated $200 million in net sales for its most recent
year end2.
With Valvoline's goal to grow its network to 3,500-plus stores,
the addition of Breeze Autocare will bring the total store count to
more than 2,200 locations across North
America. Valvoline expects its track record of
successful acquisition integration and operational capabilities
will drive meaningful transaction growth and unlock long-term
synergies. Initially, the Breeze Autocare stores will continue to
operate under their current branding. Valvoline is developing its
long-term integration plan which may include the possible
refranchising of certain stores.
"Welcoming Breeze Autocare into the Valvoline network allows us
to immediately add nearly 200 stores that are geographically
complementary and will expand our customer reach," said
Lori Flees, President and CEO. "This
acquisition will accelerate our growth and earnings potential while
enhancing our already strong cash flow profile. Our aligned
cultures of putting people first and our track record of
successfully integrating acquisitions give us confidence in our
ability to deliver sales and profit growth."
Eric Frankenberger, President and
CEO of Breeze Autocare, added, "Valvoline has been a respected name
in preventive maintenance for decades and we look forward to
joining forces with them. I believe our combined expertise and
culture will benefit our team members and customers for years to
come."
Strategic and Financial Benefits of the Transaction
- Expands Geographic and Customer Reach: Addition of
nearly 200 stores drives accelerated network growth and reinforces
Valvoline's position as a leading provider of preventive automotive
maintenance services.
- Complementary Employee and Customer-Focused Operating
Model: Well-trained employees delivering a best-in-class
customer experience focused on speed, ease and trust with highly
consistent cultures.
- Scale Advantages: Allows Valvoline to leverage the
benefits of scale, such as retail-specific technology investments
and fleet sales expansion, across a larger store base.
- Compelling Financial Benefits: Based on Valvoline's
track record of successfully integrating acquisitions into its
network, this transaction will enable delivery of top line sales
and profit growth and enhance an already strong cash flow profile.
The purchase price represents a multiple of 10.7 times Breeze
Autocare's adjusted EBITDA1. The transaction is expected
to be relatively neutral to Valvoline's adjusted diluted EPS in the
first year and accretive over time.
Transaction Details
The transaction is anticipated to close in fiscal Q3 2025
subject to satisfaction of customary closing conditions and
regulatory approvals. The purchase price is expected to be funded
with a newly issued Term Loan B. Valvoline will pause its share
repurchase activity and anticipates reaching a rating agency
adjusted net leverage ratio of 2.5x - 3.5x within 24 months
post-close.
Notes
- Adjusted EBITDA is a non-GAAP pro forma measure for the twelve
month period ended October 31, 2024
based upon reported results adjusted for certain normalizing and
pro forma activity as a result of buy-side diligence.
- Unaudited amount for the year ended December 28, 2024.
Advisors
Morgan Stanley & Co. LLC is serving as financial advisor and
Squire Patton Boggs (US) LLP is serving as legal advisor to
Valvoline Inc. Jefferies Group LLC is serving as financial advisor
and Kirkland & Ellis LLP is serving as legal advisor for Breeze
Autocare.
Conference Call
Valvoline will host a live audio webcast to discuss the
transaction today, February 20, 2025,
at 9 a.m. ET. The webcast and
supporting materials will be accessible through Valvoline's website
at http://investors.valvoline.com. Following the live
event, an archived version of the webcast and supporting materials
will be available.
About Valvoline Inc.
Valvoline Inc. (NYSE: VVV) delivers quick, easy, trusted service
at more than 2,000 franchised and company-operated service centers
across the United States and
Canada. The company completes more
than 28 million services annually system-wide, from 15-minute
stay-in-your-car oil changes to a variety of
manufacturer-recommended maintenance services such as wiper
replacements and tire rotations. At Valvoline Inc., it all starts
with our people, including the 11,000 team members who are working
to grow the core business, expand the company's retail network, and
plan for the vehicles of the future. For more information, visit
vioc.com.
About Breeze Autocare
Breeze Autocare is an independent provider of automotive quick
lube and other preventative maintenance services with nearly 200
locations in the United States.
The company employs a "stay in your car" service model enabling
quality, speed, and simplicity for its customers. Breeze is proud
to employ approximately 1,000 employees at stores spread across the
country in 17 states.
About Greenbriar
Greenbriar is a middle market private equity firm with 20+ years
of experience investing in market-leading services and
manufacturing businesses. With $10+ billion of cumulative capital
commitments, its investment strategy targets businesses led by
experienced management teams capitalizing on strong long-term
growth prospects that can benefit from Greenbriar's deep sectoral
expertise, strategic insight, and operating capabilities. For more
information, please visit greenbriarequity.com.
Forward-Looking Statements
Certain statements herein, other than statements of historical
fact, are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements may include, without limitation,
statements about the proposed transaction to acquire Breeze
Autocare, including its Oil Changers stores, the expected timetable
for completing the proposed transaction, and the benefits and
synergies of the proposed transaction; executing on the growth
strategy to create shareholder value by driving the full potential
in Valvoline's core business, accelerating network growth and
innovating to meet the needs of customers and the evolving car
parc; realizing the benefits from acquisitions and refranchising
transactions; and future opportunities for the stand-alone retail
business; and any other statements regarding Valvoline's future
operations, financial or operating results, capital allocation,
debt leverage ratio, anticipated business levels, dividend policy,
anticipated growth, market opportunities, strategies, competition,
and other expectations and targets for future periods. Valvoline
has identified some of these forward-looking statements with words
such as "anticipates," "believes," "expects," "estimates," "is
likely," "predicts," "projects," "forecasts," "may," "will,"
"should," and "intends," and the negative of these words or other
comparable terminology. These forward-looking statements are based
on Valvoline's current expectations, estimates, projections, and
assumptions as of the date such statements are made and are subject
to risks and uncertainties that may cause results to differ
materially from those expressed or implied in the forward-looking
statements. Additional information regarding these risks and
uncertainties are described in Valvoline's filings with the
Securities and Exchange Commission (the "SEC"), including in the
"Risk Factors," "Management's Discussion and Analysis of Financial
Condition and Results of Operations," and "Quantitative and
Qualitative Disclosures about Market Risk" sections of Valvoline's
most recently filed periodic reports on Forms 10-K and 10-Q, which
are available on Valvoline's website
at http://investors.valvoline.com/sec-filings or on the
SEC's website at http://www.sec.gov. Valvoline assumes no
obligation to update or revise these forward-looking statements for
any reason, even if new information becomes available in the
future, unless required by law.
™ Trademark, Valvoline Inc., or its subsidiaries, registered in
various countries
FURTHER INFORMATION
Investor Inquiries
Elizabeth B. Clevinger
+1 (859) 357-3155
IR@valvoline.com
Media Inquiries
Angela
Davied
media@valvoline.com
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SOURCE Valvoline Inc.
