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LEXINGTON, Ky. - Valvoline Inc. (NYSE: VVV), currently trading at $32.75 and near its 52-week low of $31.02, and Greenbriar Equity Group, L.P. have received a second request for information from the U.S. Federal Trade Commission (FTC) regarding Valvoline's planned acquisition of Breeze Autocare. According to InvestingPro analysis, the company shows strong fundamentals with an EBITDA of $508.3M. This request extends the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, delaying the acquisition process.
The FTC's request for additional information and documentary material, known as the Second Request, prolongs the waiting period until 30 days after both parties have complied, unless the FTC terminates or the parties voluntarily extend this period. Valvoline's acquisition of Breeze Autocare, which includes Oil Changers stores, is subject to the fulfillment of this waiting period and other customary closing conditions. With revenue growth of 11.85% in the last twelve months, Valvoline continues to demonstrate strong operational performance. For detailed financial analysis and additional insights, investors can access comprehensive research through InvestingPro.
Valvoline has expressed an intention to work constructively with the FTC to facilitate a timely closure of the transaction, which is anticipated to be finalized in the second half of fiscal 2025. Valvoline, a provider of automotive services with over 2,000 franchised and company-operated service centers in North America and a market capitalization of $4.16 billion, sees the acquisition as part of its growth strategy, aiming to expand its retail network and adapt to evolving customer and vehicle needs. InvestingPro data reveals the company maintains healthy profitability with earnings per share of $2.10.
The company's forward-looking statements suggest that the acquisition is expected to create shareholder value by leveraging potential synergies and enhancing the company's core business. However, these statements are subject to various risks and uncertainties that could cause actual results to differ materially.
Valvoline's commitment to growth is underscored by the company's annual completion of over 28 million services, ranging from oil changes to tire rotations, and its workforce of 11,000 team members.
Investors and stakeholders are reminded that this information is based on a press release statement and that further details on the company's risks and future projections can be found in Valvoline's SEC filings. These documents provide insight into the company's financial condition, operating results, and market risks, which are important considerations for those monitoring the progression of this acquisition.
In other recent news, Valvoline Inc. reported first-quarter earnings and revenue that surpassed analyst expectations, with adjusted earnings per share reaching $0.32 against the anticipated $0.30. Revenue for the quarter was $414 million, exceeding projections of $396.83 million, marking an 11% year-over-year increase. The company saw an 8.0% rise in system-wide same-store sales and added 35 new stores, including 14 franchised locations. System-wide store sales grew by 14% to $820 million, while adjusted EBITDA increased by 14% to $103 million. Valvoline's management remains confident in meeting full-year guidance, aiming to expand its store network to over 3,500 locations.
Moody's Ratings recently changed Valvoline's outlook to negative from stable, affirming its Ba2 corporate family rating. This shift is linked to Valvoline's plan to acquire Breeze Autocare for around $625 million, which will be financed entirely through debt. Despite the increased leverage, Moody's expects industry fundamentals to support Valvoline's growth and improve credit metrics over time. TD Cowen initiated coverage on Valvoline with a Buy rating and a $40 price target, citing strong competitive barriers and anticipated revenue growth in the low-to-mid-teens percentage range. The firm expects Valvoline to experience multi-year growth in EBITDA margins, driven by operational efficiencies and a franchisee-led growth model.
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