Digital Auto Care Factbook 2018 - 31

Select Auto Care Transactions
Recent Aftermarket and Supplier M&A
View from 30k Feet
2016 was another strong year for M&A transaction volume, with 130+ Aftermarket transactions occurring in North America. Five of the
last six years have each posted over 100 M&A Aftermarket transactions, which have been fueled by 1) industry drivers remaining
favorable (increasing miles driven, growing car PARC, aging fleet), 2) improving and stable macroeconomic backdrop, 3) leverage levels
and interest rates remaining conducive to deal-making, and 4) both financial and strategic partners eager to deploy capital.
In 2016, approximately 78% of transactions involved a strategic buyer (1), a level of strategic involvement that is in line with the last
five years' average. Of deals completed in 2016, 37 had disclosed prices - 15 of which had total transaction value exceeding $250
million. The average revenue and EBITDA multiples for these transactions were 1.3x and 10.2x, respectively.
In 81 transactions during the year, the acquired company was an Aftermarket supplier, representing an increase as a percent of total
transactions from last year. A majority of companies purchased serve the light-vehicle vehicle market and 78% were purchased by a
strategic buyer. Suppliers accounted for 60% of total M&A volume in this period, an increase from 56% last year.

Aftermarket M&A Metrics
Number of Aftermarket Transactions

2016 Aftermarket Transactions

(by Buyer Type)

(by Target Channel Position, % of Strategic Buyers)

135
42

18
23

15

22

17

33

10
12

35

20
88

124

119

20

25

104

94

Software /
Retailer Systems
6%
3%
Distributor
15%

134
30

16

52

48

41

136

93

116
72

104

38
5
33

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
YTD
Strategic Buyers

Financial Buyers

Installer / Service
Provider
16%

Supplier
60%

2016 Supplier Aftermarket M&A Metrics
Target Company Vehicle Focus(2)

Buyer Type(2)

(% of 2016 Supplier Transactions)

(% of 2016 Supplier Transactions)

Performance/
SEMA RV
3% 3%

Supplier Product Category(2)

Financial
22%

Powersports
1%
Heavy Duty
16%

Cars / Light
Duty
76%

Strategic
78%

(% of 2016 Supplier Transactions)
Collision /
Body Parts Other
/ Mirrors 14%
3%
Oil / Lube
3%
Car Wash
3%
Brakes /
Friction
4%
Electronics
/ Sensors
4%
Glass /
Windshield
4%
Repair
Serv. General Software /
4%
Data / Info
Services
Chemicals
5%
5%

Broadline
9%

Accessories
- External
9%

Tires
7%
Accessories
- Internal
7%
Engine
7%
Tools /
Shop
Towing /
Cargo Equipment
5%
5%

(1) Includes private equity-owned strategic buyers.
(2) According to Jefferies' internal estimates / tracking.

Automotive Aftermarket | March 31, 2017

Jefferies.com

The 2018 Digital Factbook is Copyright © 1990 Auto Care Association and/or its licensor. 
All other rights reserved.  Use of the 2018 Digital Factbook is subject to compliance with the Legal Terms and Conditions found on page 119 of this report.

31
http://www.Jefferies.com
Table of Contents for the Digital Edition of Digital Auto Care Factbook 2018
