LKQ taps Bank of America to sell specialty parts business, sources say

LKQ

13/11/2025 17:47

LKQ hires investment bank to run sales process, sources say

Process comes after sale of its self services segment to private equity

Some investors pushing for more, asking company to sell European business

By Svea Herbst-Bayliss

NEW YORK, Nov 13 (Reuters) - Auto parts supplier LKQ LKQ.O is planning to sell Keystone Automotive Industries, its specialty parts division, three people familiar with the matter told Reuters, as the company faces pressure from investors to sell some assets to maximize shareholder value.

The division could be worth roughly $1 billion, according to LKQ's internal valuations, analysts at Raymond James have previously said.

THE DETAILS

The company has hired investment bankers at Bank of America BAC.N to help find a buyer for Keystone, the people said, asking not to be identified to discuss the confidential process.

Keystone offers specialty replacement parts for cars and trucks, including bumpers, hoods, and remanufactured wheels.

LKQ has been approached in the past by private equity investors and began taking meetings with potentially interested parties at a recent industry conference in Las Vegas, one of the sources said.

Representatives for LKQ and Bank of America declined to comment.

THE NUMBERS

Chicago-headquartered LKQ has a market value of just over $8 billion.

Its shares are down roughly 20% over the last 12 months, despite the company's attempts to overhaul its portfolio.

THE BACKGROUND

In August, LKQ said it was selling its self-service segment to private equity firm Pacific Avenue Capital Partners for an enterprise value of $410 million.

With the stock still depressed, some investors are now pushing management to sell its European business.

Activist investor Ananym Capital intensified its call last month to sell LKQ's European operations to focus on its flourishing North American business.

Ananym argued that there are interested buyers in the European business and that the proceeds could be used to buy back shares, according to a letter viewed by Reuters.

(Reporting by Svea Herbst-Bayliss. Editing by Dawn Kopecki and Rod Nickel)

((svea.herbst@thomsonreuters.com; +617 233 2138; Reuters Messaging: svea.herbst.thomsonreuters.com@reuters.net/))