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Bulletin: LKQ Corp. Announces Acquisition; No Immediate Ratings Impact, But Leverage Will Rise Oct 11
Standard & Poors, Oct 2011
Abstract
NEW YORK (Standard & Poor's) Oct. 4, 2011--Standard & Poor's Ratings Services said today that LKQ Corp.'s (BB+/Stable/--) announcement of the acquisition of Euro Car Parts for a reported $347 million has no immediate impact on the rating for LKQ. The acquired company appears to be a smaller, but similar operation to LKQ (aftermarket collision replacement products), and expands the company's presence outside North America for the first time. Still, the leveraged acquisition involves execution risk and the consolidated adjusted leverage under our estimates could be up to 3x at close. For the current rating, we assume adjusted debt to EBITDA will be under 2.5x; we believe LKQ's demonstrated cash-generation capabilities will permit leverage to return to close to current...
Companies mentioned in this report are: LKQ Corp.
Action: Bulletin
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research type: News
This product is a is a brief one-page announcement of no more than 500 words with a quote from the analyst. It is media and investor focused with no accompanying commentary article.
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