Activist investor ADW Capital, led by Adam Wyden, has submitted an unsolicited offer to acquire automotive services group Driven Brands Holdings Inc in a deal valued at nearly $3bn, escalating its campaign for strategic change at the company, according to a report by the Wall Street Journal.
The hedge fund, which holds a stake of roughly 3.7%, has proposed paying $18 per share in cash—representing a premium of around 40% to recent trading levels. ADW said it has engaged potential financing partners, including banks, private equity firms and family offices, and believes funding can be secured pending due diligence.
The proposal is aimed at removing control from majority shareholder Roark Capital Group, which owns approximately 60% of Driven Brands and has held the investment since taking the company private in 2015 before its public listing in 2021.
ADW argues that the business has been poorly managed and suffers from governance and capital allocation issues, pointing to what it describes as underperformance and a prolonged decline in the share price since the IPO. It also criticises Roark’s broader strategic focus, suggesting attention has been diverted to other portfolio priorities.
Driven Brands operates a portfolio of automotive service franchises, including Meineke and Auto Glass Now. The company has faced additional scrutiny following recent disclosures of material accounting errors and weaknesses in internal controls.
ADW has separately suggested that a full sale process could ultimately yield a higher valuation – potentially above $30 per share – if run through a competitive auction involving strategic buyers or private equity firms. However, its current proposal reflects a lower near-term bid, paired with a stated intention to drive operational improvements post-acquisition.
The activist investor has urged Driven’s board and Roark to engage with the offer or initiate a formal strategic review, including exploring a sale or breakup of the business. It added that if management believes a higher valuation is achievable, it should appoint advisers and begin a formal process.
