Motorcar Parts of America Inc. on Monday said that it acquired Fenwick Automotive Products Ltd. in a stock deal valued at more than $5 million. The acquisition will broaden the company’s product line.
The Torrance provider of remanufactured alternators and starters for cars, trucks and other vehicles said that it would pay 360,000 shares of Motorcar Parts stock to the owners of Toronto, Ontario-based Fenwick, also known as Fenco.
Fenco makes and distributes new and remanufactured private label and branded aftermarket auto parts, such steering components, brake calipers, and clutches, mainly in North America. Motorcar Parts said the acquisition is expected to more than double its consolidated revenues and expand strategic supplier relationships throughout Asia. In addition to Toronto, Fenco has facilities in Pennsylvania, New Hampshire and Mexico.
"The acquisition complements our existing customer relationships and adds new sales cross-over opportunities,” Chief Executive Selwyn Joffe said in a statement.
The company expects to achieve annual savings of at least $20 million once the acquisition is integrated, which is expected to take two years. Joffe expects Fenco to contribute at least $25 million of annual EBITDA (earnings before interest, taxes, depreciation and amortization) from existing revenue once the integration is complete.
Shares closed up 69 cents, or 5 percent, to $14.65 on the Nasdaq.
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