Pep Boys agreed to be acquired by Carl Icahn for more than $1 billion after Bridgestone Corp. backed down from a bidding war with the billionaire investor.

The auto-parts chain said on Wednesday that it terminated an earlier merger pact with Bridgestone and signed a definitive agreement to be bought by Icahn Enterprises for $18.50 a share. Icahn’s investment firm also will pay Bridgestone a $39.5 million termination fee on behalf of Pep Boys.

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