Shares of Mister Car Wash, a prominent car wash operator, saw a substantial increase today after the company revealed an agreement to be taken private. This development, coupled with its latest quarterly financial disclosures, led to considerable investor activity. The acquisition deal, offering a notable premium, appears to be the primary driver behind this market surge, making the quarterly results a secondary focus for stakeholders.
As of 11:00 a.m. ET, the company's stock had climbed by approximately 16.4%, reaching $6.99 per share. This jump comes on the heels of an announcement regarding a definitive merger agreement with Leonard Green & Partners (LGP), a private equity firm that already holds a significant stake in Mister Car Wash.
The terms of the agreement state that LGP will acquire all outstanding shares of Mister Car Wash for $7.00 each. This price point signifies a 29% premium when compared to the volume-weighted average price of the company's stock over the past 90 days. The total valuation of the company implied by this transaction stands at an enterprise value of $3.1 billion, with the acquisition anticipated to be finalized by the conclusion of June.
In a separate but concurrent announcement, Mister Car Wash released its financial performance for the fourth quarter. The company reported adjusted earnings per share of 11 cents, slightly surpassing market expectations. Revenue for the quarter rose by 4% year-over-year, reaching $261.2 million, attributed in part to the addition of 16 new operational locations. Net income for the period was recorded at $20.1 million.
Although the quarterly financial results indicated a positive performance that might have independently led to a modest uptick in share value, the overriding news of the private acquisition largely overshadowed these figures. Given that Leonard Green & Partners already controls a 67% majority stake in Mister Car Wash, the likelihood of a competing offer emerging for the remaining shares appears minimal.
The significant rise in Mister Car Wash's stock today is predominantly due to its definitive merger agreement with Leonard Green & Partners, offering a substantial premium to shareholders. While the fourth-quarter earnings report showed solid growth, the acquisition news has become the central focus, pushing the stock price to align closely with the agreed-upon buyout figure, and suggesting a near-certain path to the company's privatization.
