NEW YORK CITY—The Blackstone Group said Wednesday it would acquire a majority stake in Service King Collision Repair Centers, among the nation's largest independent chains of auto body repair centers, from the Carlyle Group. Terms of the transaction were not disclosed; citing a source familiar with the deal, the Wall Street Journal reported that the deal was valued at $650 million.

Carlyle, along with its co-investors and the management and employees of Service King, will retain a significant minority stake in the Dallas-based company. Carlyle entered the picture in August 2012 with equity from the $1.1-billion Carlyle US Equity Opportunity Fund and the $700-million Carlyle Strategic Partners Fund III L.P.

At that time, Service King was centered primarily around Texas' major cities. Founder Eddie Lennox took out a $10,000 loan in 1976 and began making repairs from his Dallas garage; the chain had grown to about four dozen locations across the Lone Star State by the time Carlyle acquired a majority stake. Carlyle made a commitment to growing the chain, and Service King began expanding into Arizona, Tennessee, Arkansas, Mississippi, Nevada and Oklahoma.

A deal this past April for Sterling Collision Centers added 62 stores to the total and brought Service King's reach to 20 states. Sterling was founded in 1997 and acquired by Allstate in 2001. Earlier this month, Service King acquired Collision Centers of Wylie and Rowlett in North Texas, with the two new sites bringing the total to 177.

“We look forward to partnering with management, the Company's employee-owners, and Carlyle to support Service King's continued growth and expansion,” says Peter Wallace, senior managing director at Blackstone. A report in the WSJ identified the Service King buy as typical of Blackstone's recent move toward smaller, high-growth deals as traditional buyout deals become more expensive.  

The WSJ reported that another collision repair chain backed by private equity is on the auction block. Palladium Equity Partners LLC has hired an investment bank to sell ABRA Auto Body & Glass, which could fetch north of $500 million, according to the WSJ.