Penske enters merger agreement to be taken private
Penske Automotive Group, an automotive and commercial truck retailer, has entered a merger agreement to be taken private by Motown Acquisition Group (Owned by Penske Corporation) and Mitsui & Company, according to a press release.
The proposed transaction was unanimously recommended by a special committee of independent and disinterested directors of the board of directors, the release states. It was formed to evaluate and consider the proposal and was advised by independent legal and financial advisors. The transaction was approved by the board per the recommendation of the special committee.
“We are pleased to have reached this agreement with Penske and Mitsui, our largest shareholders,” said David Hoogendoorn, Penske Automotive Group board member and the special committee Chair. “The Special Committee thoroughly reviewed the proposal and considered the benefits of the transaction as compared to continuing as a public company, and determined that this transaction provided the greatest value for the Company’s minority shareholders.”
Under the terms of the merger agreement, holders of Penske Automotive Group common stock will receive $212 per share in cash, valuing the company at an enterprise value of approximately $16.3 billion. Penske Corporation, Mitsui and other investment group members were excluded from receiving cash for shares.
About 64% of Penske Automotive Group’s ownership will be held by Penske and 36% to be held by Mitsui.
The purchase price represents a premium of about 8.6% to the closing price of the company’s common stock on July 21 and a premium of about 20.09% and 26.17% to the 60-day and 90-day volume weighted average prices for the period ending July 21. It was an 8.84% premium to the closing price of the Company’s common stock on Oct. 14.
Regular quarterly cash dividends will continue to be paid through the closing of the transaction, not to exceed $0.02 per share above the per share amount of the last quarterly dividend declared and paid by the company.
“I want to thank the special committee for its thoughtful and diligent evaluation of the transaction,” said Roger Penske, chair and CEO of the company. “This transaction marks an important next chapter for PAG. Mitsui has been a shareholder for 25 years, and we have had a productive relationship over the past quarter-century. Together with Mitsui, we will build on PAG’s operational excellence and draw on our combined capabilities and networks to drive innovation and expand PAG’s business through new opportunities and collaborative projects.”
The transaction is expected to close in the first quarter of 2027. The closing will require a receipt of regulatory approvals and the affirmative vote of the holders of a majority of outstanding shares of the company’s common stock, and approval by holders of a majority of the votes cast by unaffiliated stockholders.
The stocks will no longer be traded or listed on the New York Stock Exchange, following closing of the transaction.
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