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Directors with expertise in industrial distribution, tech

leadership to join board immediately

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Elliott invested more than $1 billion in Genuine Parts ( GPC )

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Elliott partner Marc Steinberg led engagement

By Svea Herbst-Bayliss

NEW YORK, Sept 4 (Reuters) - Automotive and industrial

parts distributor Genuine Parts Company ( GPC ), which operates

the NAPA Auto Parts stores and Motion Industries, has reached a

settlement with activist investor Elliott Investment Management

to add two new directors to its board.

Atlanta-headquartered Genuine Parts ( GPC ) and West Palm Beach,

Florida-headquartered Elliott have been holding talks since the

investment firm made a more than $1 billion bet on the company

and became its largest active shareholder, the two sides said on

Thursday, confirming an earlier report by Reuters.

Elliott partner Marc Steinberg led the engagement.

The new directors will bring expertise in industrial

distribution and technology leadership at a time the company is

undergoing a strategic and operational review to improve

profitability and boost the share price, the sources said. The

company and investor also reached an information-sharing

agreement that will allow for continued dialogue between Elliott

and Genuine Parts ( GPC ).

Details about the review and Genuine Parts' ( GPC ) future plans

will likely be announced and discussed at an investor day the

company expects to hold next year.

The review is not aimed at evaluating the sale of the company

but rather to find ways to boost operational performance and

profitability.

"We will continue to evaluate and pursue opportunities that

enhance operational performance, improve profitability and

unlock shareholder value," Genuine Parts ( GPC ) CEO Will Stengel said

in a statement.

Founded in 1928, Genuine Parts ( GPC ) now has a market value of

roughly $19 billion as its Automotive Parts Group distributes

replacement parts around the world, primarily under the NAPA

brand name. Its Motion Industries business provides highly

engineered parts and services to manufacturing and industrial

industries primarily in the United States.

The stock price climbed 2% on Thursday, boosted by the news.

Since January, it has gained almost 20% but is still seen as

undervalued compared with both its automotive competitors like

AutoZone ( AZO ) and O'Reilly Automotive and its

industrial distribution competitors like Fastenal ( FAST ),

Grainger and Applied Industrial Technologies ( AIT ).

"We believe the company's current share price does not

reflect the true value of its automotive aftermarket and

industrial distribution businesses, and that there is a clear

path to creating substantial, long-term value" at Genuine Parts ( GPC ),

Steinberg said in a statement.

Courtney Carruthers, who previously served as president and

CEO of TricorBraun, a B2B global packaging distributor, and in

executive leadership roles at Grainger, and Matt Carey, who

served as chief information officer at Home Depot ( HD ), will

join the board as independent directors on Thursday.

They will replace Robert Loudermilk and John Holder, who are

retiring. The board will have 12 directors.

Over the last 16 months five newcomers have joined the board and

six directors have retired.

Elliott, one of the world's busiest and largest activist

investors with roughly $76 billion in assets, announced an

investment in PepsiCo ( PEP ) earlier this week, and has

invested in the industrial space including at Honeywell ( HON )

and Howmet Aerospace ( HWM ).

It also reached similar agreements at medical-device maker

Medtronic ( MDT ) and pharmaceutical company Charles River

Laboratories ( CRL ) without its investments being made public

before agreements were reached.