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Guhan Subramanian & Caeden Brynie, LKQ-Stahlgruber (2021).

Abstract: Through a combination of organic growth and acquisitions, LKQ Corp. became the leading aftermarket auto parts distributor in the U.S. by the early 2000s. Beginning in 2012, the company began similarly consolidating the European marketplace. However, by 2017, the company still lacked a meaningful presence in Germany, which was the largest automotive market in Europe. Stahlgruber AG, the largest German distributor, became available as an acquisition opportunity. Senior LKQ management had to decide whether to participate in the sale process, and if so, how high to bid. Bain Capital, which was also making aggressive moves into the European marketplace, was likely to be the other significant bidder. On one hand, “Project Jigsaw” (named as such because Stahlgruber would be the jigsaw piece in the center of the European puzzle) represented a once-in-a-lifetime opportunity for LKQ. On the other hand, the competitive bidding process would force LKQ to stretch financially. The case presents the challenges and opportunities presented by the Stahlgruber acquisition.