Why Mister Car Wash Stock Surged This Morning

Shares of car-wash relation Mister Car Wash (NASDAQ: MCW) were sharply higher connected Wednesday greeting pursuing its net study -- and connected quality that the institution has struck a woody to spell backstage for $7.00 per share.

As of 11:00 a.m. ET, shares were up astir 16.4% to $6.99.

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In an aboriginal greeting statement, Mister Car Wash said it has entered into a "definitive merger agreement" with backstage equity steadfast Leonard Green & Partners (LGP). LGP presently owns astir two-thirds of the car-wash giant.

Under the deal, LGP volition acquisition the remaining shares of Mister Car Wash for $7.00 per share, a terms that represents a 29% premium to the volume-weighted mean terms of the company's banal successful the preceding 90 days.

The terms implies an enterprise value of $3.1 cardinal for the company. The transaction is expected to adjacent by the extremity of June.

Separately, Mister Car Wash announced its fourth-quarter results connected Wednesday morning. Adjusted net per stock of 11 cents were somewhat up of Wall Street's expectations. Revenue was up 4% twelvemonth implicit twelvemonth to $261.2 million, arsenic the institution added 16 caller locations during the period. Net income was $20.1 million.

All successful all, a decent 4th that astir apt would person nudged shares moderately higher. But the woody to spell backstage made the results mostly irrelevant.

Given that LGP already owns 67% of Mister Car Wash, I don't spot a competitory bid emerging. Still, if you ain the stock, there's astir apt nary harm successful waiting a bit.

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