Topic: How To Invest

Wall Street Stock Forecaster Hotline – Friday, September 14, 2018

Article Excerpt

GENUINE PARTS CO., $101.90, New York symbol GPC, sells replacement auto parts through 1,100 outlets under the NAPA banner; and the company’s distribution business serves 4,900 independent stores in North America, Australia and New Zealand. Genuine also distributes industrial parts, office products and electrical equipment. The company recently announced that it would spin off its S.P. Richards business. As a separate company, S.P. Richards would then merge with Essendant Inc. (Nasdaq symbol ESND). The combined firm would be a leading distributor of janitorial and office products, and furniture. However, Sycamore Partners, the private equity owner of office supply chain Staples, made a competing offer to buy Essendant for $11.50 per share in cash. Sycamore Partners already owns 9.9% of Essendant. This week, Essendant agreed to accept the Sycamore offer and cancelled the merger with S.P. Richards. As a result, Essendant will pay Genuine Parts a $12 million break-up fee. That’s equal to 5% of the $233.6 million, or $1.59 a share, Genuine earned…

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