Driven Brands Agrees To Sell International Car Wash Business

Driven Brands Holdings

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(RTTNews) - Driven Brands Holdings Inc. (DRVN), an auto and truck dealership company, Tuesday announced that it has agreed to sell its international car wash business or IMO to Franchise Equity Partners for 406 million euros.

As per the agreement, Franchise Equity Partners will acquire IMO based on IMO's balance sheet as of June 30, 2025 and the deal is expected to close in the first quarter of 2026.

"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 of driven Brands.

The cash proceeds from this divestiture will be mainly used to pay down debt and for general corporate purposes.

In relation to this divestiture, the company has updated it financial outlook for fiscal 2025 as it plans to report results of the Car Wash segment as discontinued operations beginning in the fourth quarter of 2025. It now expects revenue in the range of around $1.85 billion to around $1.87 billion and Adjusted EBITDA of around $445 million to $$455 million. Adjusted Diluted EPS from continuing operations in the range of $1.18 to $1.23 on a preliminary basis.

Previously, the company had expected revenue in the range of around $2.1 billion to around $2.12 billion with Adjusted EBITDA ranging from around $525 million to $535 million and Adjusted Diluted EPS ranging from $1.23 to $1.28.

The company continues to expect net store growth of approximately 175 to 200.

On Monday, DRVN shares closed at $14.13, down 3.29% on the Nasdaq.