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Driven Brands Holdings Inc. (NASDAQ:DRVN) ("Driven Brands" or the "Company") today announced that it has entered into a definitive agreement to sell IMO, its international car wash business to Franchise Equity Partners.
"This transaction sharpens our focus on what we do best — scaling Take 5 and driving consistent cash generation through our Franchise Brands," said Danny Rivera, President and Chief Executive Officer. "IMO is a good business, but it is not core to our long-term strategy. By exiting it, we simplify our portfolio, strengthen our balance sheet, and position Driven Brands to create greater value for shareholders."
Under the terms of the agreement, Franchise Equity Partners will acquire IMO for € 406 million, based on IMO's balance sheet as of June 30, 2025, which amount is not subject to post-closing adjustments for cash, debt or working capital. The agreement includes customary ‘locked box' protections against certain types of financial leakage, and a customary ‘ticker' whereby the purchase price increases daily by a fixed amount in Euros from July 1, 2025, to the closing date.
The transaction is expected to close in the first quarter of 2026, subject to receipt of specified regulatory approvals.
"The divestiture of our international car wash business helps accelerate our path towards de-levering our balance sheet while maintaining operational focus on our core, North American businesses. This transaction will reduce pro forma leverage by approximately 0.3x and demonstrates our commitment to achieve 3x net leverage by the end of 2026," said Mike Diamond, Chief Financial Officer.
Cash proceeds from the transaction will primarily be used to pay down debt and general corporate purposes.
The Company plans to report the results of the Car Wash segment as discontinued operations beginning in the fourth quarter of 2025. Auto Glass Now, currently reported in the Corporate & Other segment, will be reported as a stand-alone segment beginning in the fourth quarter of 2025.
In conjunction with the divestiture, the Company updated its financial outlook from continuing operations for the fiscal year ending December 27, 2025, to reflect the reclassification of the international car wash business as discontinued operations as follows:
| 2025 Outlook | |
| Revenue | ~$1.85 - $1.87 billion |
| Adjusted EBITDA | ~$445 - $455 million |
The Company now expects Adjusted Diluted EPS from continuing operations in the range of $1.18 to $1.23 on a preliminary basis, subject to final determination of income tax impacts related to the divestiture.
With the reclassification of the international car wash business to discontinued operations, the Company now expects same store sales growth to be slightly below the low end of its original range of 1% to 3%.
The Company continues to expect net store growth of approximately 175 to 200.
On a pro forma basis, reflecting the divestiture of the international car was business, the Company now expects capital expenditures as a percent of revenue from continuing operations to be approximately 6.5% – 7.0% of sales.
Posted In: DRVN
