Valvoline (VVV) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of Breeze Autocare adds nearly 200 stores, accelerating network growth toward a 3,500+ store target and expanding presence in California, Texas, the Midwest, and 17 states.

• Breeze Autocare's footprint is highly complementary, with minimal overlap and strong cultural alignment focused on people and customer experience.

• Enables leveraging of scale for technology investments, fleet sales, and operational best practices.

• Opportunity to densify existing regions, enter underserved markets, and reinforce leadership in preventive maintenance.

• Builds on a successful track record of integrating acquisitions to drive sales and profit growth.

Financial terms and conditions

• Purchase price is approximately $625 million in cash, representing a 10.7x multiple of trailing 12-month adjusted EBITDA.

• Funded through a newly issued Term Loan B facility; share repurchases paused to prioritize debt repayment.

• Target net leverage ratio to return to 2.5–3.5x within 24 months post-closing.

• Transaction expected to close in fiscal Q3 2025, subject to customary closing conditions and regulatory approvals.

• Expected to be neutral to adjusted diluted EPS in year one and accretive over time.

Synergies and expected cost savings

• Anticipated synergies in G&A, marketing, fleet sales, and operating costs, with potential for best practice and technology sharing.

• Lean SG&A structure at Breeze offers further cost-saving opportunities.

• Scale enables retail technology investments and expansion of fleet sales across a larger store base.

• Enhanced cash flow profile and delivery of top line sales and profit growth.

• Long-term synergies anticipated from operational integration and possible refranchising.