NASHVILLE—Bridgestone Americas will pay $17 per share, or approximately $947 million in equity value, to acquire Pep Boys—Manny Moe & Jack in a revised merger deal announced late Thursday afternoon. The sweetened deal comes two months and one bidding war after Nashville-based Bridgestone and Philadelphia-based Pep Boys announced a merger agreement that at the time was worth $15 per share or $835 million to Pep Boys shareholders.

The bidding war began earlier this month, when Carl Icahn's Icahn Enterprises offered $15.50 per share for Pep Boys after disclosing a stake of approximately 12% in the auto parts and service chain. Bridgestone subsidiary Bridgestone Retail Operations matched the Icahn offer, when Icahn then increased to $16.50 per share, an offer that the Pep Boys determined was "a superior proposal." Following the revised agreement with Bridgestone announced Thursday, the Pep Boys said it no longer considered Icahn's offer superior.

In an SEC filing, Icahn said it would top any Bridgestone offer by 10 cents per share up to $18.10 per share, a figure that would have put the price tag for Pep Boys at slightly more than $1 billion. However, the Icahn filing said the offer would not apply if Pep Boys and Bridgestone agreed to an increased breakup fee. The two companies did agree to such an increase in the deal announced Thursday, upping it from $35 million to $39.5 million.

"Nearly a century ago, the founders of both our companies created what has become today's automotive aftermarket retail model," says Stu Crum, president, Bridgestone Retail Operations. "In addition to our long and successful histories in this industry, Pep Boys and Bridgestone share a common vision for the future—to continue to build upon this 100-year foundation to form an even stronger company, one that is renowned for its commitment to being the most trusted provider of automotive service in every neighborhood it serves."

Prior to the Oct. 26 announcement from Pep Boys and Bridgestone, Pep Boys' board rejected a $13.50/share offer from Icahn, who wanted to merge the chain with his Auto Plus stores. A 2012 privatization by the Gores Group, which would have given Pep Boys an enterprise value of $1 billion, fell apart after the buyer walked away amid a disappointing report of first-quarter results at Pep Boys' locations across 35 states and Puerto Rico.

The Pep Boys acquisition will add approximately 800 locations and 7,500 service bays to BSRO's nationwide network of 2,200 tire and automotive service centers, which operate under the Firestone Complete Auto Care, Tires Plus, Hibdon Tires Plus and Wheel Works brand banners. Bridgestone also has a network of more than 5,000 dealers and distributors across the US. Reportedly the merger will create the world's largest retail chain of its kind.

J.P. Morgan Securities LLC is acting as the exclusive financial advisor to Bridgestone, while Jones Day is acting as Bridgestone's legal advisor. Rothschild is acting as the exclusive financial advisor to Pep Boys; Morgan, Lewis & Bockius LLP is providing legal counsel to Pep Boys on the merger.