BOUCHERVILLE, July 21, 2023 – Uni-Select Inc. (TSX:UNS) (“Uni-Select”) today provides an update regarding today’s decision by the U.K. Competition and Markets Authority (“CMA”) following its fast-track Phase 1 review process. The CMA has required a remedy (known as “undertakings in lieu of reference” or “UILs”) in order to address concerns it has identified about the impact on markets in the United Kingdom of the previously announced plan of arrangement under the provisions of the Québec Business Corporations Act involving Uni-Select, LKQ Corporation and 9485-4692 Québec Inc., a wholly-owned subsidiary of LKQ Corporation.
Uni-Select and LKQ Corporation are currently reviewing the U.K. CMA’s decision and will promptly engage to formally submit a remedy proposal (UILs) to the U.K. CMA. As previously disclosed, subject to the procedure outlined in the arrangement agreement, LKQ Corporation and 9485-4692 Québec Inc. have agreed to commit to the divestiture of Uni‑Select’s GSF Car Parts business in the United Kingdom, in order to receive the clearance from the U.K. CMA.
The arrangement remains subject to certain closing conditions, including the receipt of clearance from the U.K. CMA. If these conditions to closing are satisfied or waived, it is anticipated that the arrangement will be completed during the third quarter of 2023.
With over 5,200 employees in Canada, the U.S. and the U.K., Uni-Select is a leader in the distribution of automotive refinish and industrial coatings and related products in North America, as well as a leader in the automotive aftermarket parts business in Canada and in the U.K. Uni-Select is headquartered in Boucherville, Québec, Canada, and its shares are traded on the Toronto Stock Exchange under the symbol UNS.
In Canada, Uni-Select supports over 16,000 automotive repair and collision repair shops and more than 4,000 shops through its automotive repair/installer shop banners and automotive refinish banners. Its network includes over 1,000 independent customer locations and more than 95 company-operated stores, many of which operate under the Uni-Select BUMPER TO BUMPER®, AUTO PARTS PLUS® and FINISHMASTER® store banner programs.
In the United States, Uni-Select, through its wholly-owned subsidiary FinishMaster, Inc., operates over 145 automotive refinish company-operated stores under the FINISHMASTER® banner, which supports over 30,000 customers annually.
In the U.K., Uni-Select, through GSF Car Parts, is a major distributor of automotive parts supporting over 20,000 customer accounts with over 175 company-operated stores. www.uniselect.com
Caution Regarding Uni-Select Forward-Looking Information
Certain statements made in this press release are forward-looking information within the meaning of Canadian securities laws. All such forward‑looking information is made and disclosed in reliance upon the “safe harbour” provisions of applicable Canadian securities laws.
Forward-looking information includes all information and statements regarding Uni-Select's intentions, plans, expectations, beliefs, objectives, future performance, and strategy, including but not limited to the timing and effects of the proposed arrangement with LKQ Corporation and other information or statements that relate to future events or circumstances and which do not directly and exclusively relate to historical facts. Forward-looking statements often, but not always, use words such as "believe", "estimate", "expect", "intend", "anticipate", "foresee", "plan", "predict", "project", "aim", "seek", "strive", "potential", "continue", "target", "may", "might", "could", "should", and similar expressions and variations thereof.
Forward-looking information is based on Uni-Select’s perception of historic trends, current conditions and expected future developments, as well as other assumptions, both general and specific, that Uni-Select believes are appropriate in the circumstances, including but not limited to assumptions as to the ability of Uni-Select and LKQ Corporation to receive, in a timely manner and on satisfactory terms, the required regulatory clearance; the ability of Uni-Select and LKQ Corporation to satisfy, in a timely manner, the other conditions to the closing of the arrangement and the completion of the arrangement on expected terms; the impact of the arrangement and the dedication of substantial resources from Uni-Select to pursuing the arrangement on Uni-Select’s ability to maintain its current business relationships and its current and future operations, financial condition and prospects. Such information is, by its very nature, subject to inherent risks and uncertainties, many of which are beyond the control of Uni-Select, and which give rise to the possibility that actual results could differ materially from Uni-Select’s expectations expressed in, or implied by, such forward-looking information. Uni-Select cannot guarantee that any forward-looking information will materialize, and we caution readers against relying on any forward-looking information.
These risks and uncertainties include, but are not restricted to: risks associated with reduced demand for our products, disruptions of our supplier relationships or of our suppliers’ operations or supplier consolidation, increases in shipping costs, disruption of our customer relationships, competition in the industries in which we do business, the COVID-19 pandemic or other pandemics, reliance on information technology systems, security breaches, information security malfunctions or integration issues, the demand for e-commerce and failure to provide adequate e-commerce solutions, retention of employees, labor costs and availability, union activities and labor and employment laws, failure to realize benefits of acquisitions and other strategic transactions, product liability claims, product recalls, credit risk, termination or reduction of our vendor financing program, loss of right to operate at key locations, failure to implement business initiatives, failure to maintain effective internal controls, macro-economic conditions such as unemployment, inflation, changes in tax policies and uncertain credit markets, operations in foreign jurisdictions, foreign exchange, inability to service our debt or fulfill financial covenants, litigation, changes in legislation or government regulation or policies, compliance with environmental laws and regulations, compliance with privacy laws, global climate change, changes in accounting standards, share price fluctuations, environmental, social and governance activities and reputation and activist investors, the possibility that the arrangement will not be completed on the terms and conditions, or on the timing, currently contemplated, and that it may not be completed at all, due to a failure to obtain or satisfy, in a timely manner or otherwise, the required regulatory clearance and other conditions to the closing of the arrangement or for other reasons; the failure to complete the arrangement which could negatively impact the price of the shares or otherwise affect the business of Uni-Select; the dedication of significant resources to pursuing the arrangement and the restrictions imposed on Uni-Select while the arrangement is pending; the uncertainty surrounding the arrangement could adversely affect Uni-Select’s retention of customers and suppliers; the occurrence of a Material Adverse Effect (as defined in the arrangement agreement with LKQ Corporation) leading to the termination of the arrangement agreement; as well as other risks identified or incorporated by reference in our MD&A for the year ended December 31, 2022, our MD&A for the quarter ended March 31, 2023 and in other documents that we make public, including our filings with the Canadian Securities Administrators (on SEDAR at www.sedar.com).
Unless otherwise stated, the forward-looking information contained in this press release is made as of the date hereof and Uni-Select disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. While we believe that our assumptions on which the forward-looking information is based were reasonable as at the date of this press release, readers are cautioned not to place undue reliance on the forward-looking information.
Furthermore, readers are reminded that forward-looking information is presented for the sole purpose of assisting investors and others in understanding Uni-Select’s expected financial results, as well as our objectives, strategic priorities and business outlook and our anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes.
Further information on the risks that could cause our actual results to differ significantly from our current expectations may be found in the section titled "Risk Management" of our MD&A for the year ended December 31, 2022, which is incorporated by reference in this cautionary statement.
We also caution readers that the risks disclosed in our MD&A for the year ended December 31, 2022, our MD&A for the quarter ended March 31, 2023 and other documents and filings are not the only ones that could affect us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial could also have a material adverse effect on our business, operating results, cash flows and financial condition.