O REILLY AUTOMOTIVE INC acquires CSK Auto Corporation

O REILLY AUTOMOTIVE INC acquired CSK Auto Corporation for approximately $1.0 billion (including ~$500 million of assumed debt), a transaction completed in July 2008, structured as stock-for-stock exchange offer plus $1.00 cash per share. The deal was a merger.

CSK Auto Corporation operates in Automotive aftermarket parts retail (Western U.S.), is based in Phoenix, Arizona (Western United States). CSK Auto Corporation (NYSE: CAO) was one of the largest specialty retailers of auto parts and accessories in the Western United States, operating under the Checker, Schuck's, Kragen and Murray's brands. Under the merger agreement, CSK shareholders received $11.00 of O'Reilly common stock (subject to a collar) plus $1.00 in cash per share. Each CSK share was converted into 0.4285 of an O'Reilly share plus $1.00 in cash. The combination created the third-largest national auto parts retailer with approximately 3,200 stores and pro forma 2007 revenues of approximately $4.4 billion.

O'Reilly and CSK maintained highly complementary business models in two distinctive regions of the country; building on CSK's strong Western presence and O'Reilly's Midwestern and Southeastern presence, the combined company was positioned to further leverage O'Reilly's dual-market strategy and gain a national platform.

Highly complementary Western U.S. footprint with minimal geographic overlap, giving O'Reilly an instant national platform. Product acquisition cost reductions, distribution and inventory-management system rollout to acquired CSK stores, and conversion of CSK stores to O'Reilly's dual-market model. CSK stores converted to the O'Reilly brand; three CSK distribution centers retained, Minneapolis DC closed for overlap, with four new DCs planned in CSK market areas (Los Angeles, Seattle, Denver, Utah).