TASCO to buy STRAFCO unit, creating 700-store network
WACO, Texas-Texas Agricultural Service Co. Inc. (TASCO) is set to acquire one of American Car Care Centers' founding member-distributors, creating an independent tire dealer network in Texas that could include as many as 700 outlets.
TASCO, an affiliate of the Texas Farm Bureau, reached an agreement with the Straus-Frank Co. Inc. (STRAFCO) to acquire STRAFCO's Tire Division warehouses, inventory and equipment in San Antonio, Houston and Dallas for an undisclosed amount in February.
STRAFCO, a 125-year-old, San Antonio-based company, distributes tires to about 600 independent dealers throughout Texas, according to Bob Musel, vice president and general manager of the tire division.
The deal won't affect the product mix or distribution patterns STRAFCO's dealers currently receive, according to Tom Catchings, state manager of TASCO. The company plans to merge the two companies over the course of 1995.
``The two operations have a lot in common,'' Mr. Catchings said. ``They have built their business by distributing through local independent dealers....We are both interested in seeing the independent dealer succeed.''
The deal effectively marks STRAFCO's exit from tire wholesaling, allowing the company to concentrate on its core auto parts distribution business, Mr. Musel said. STRAFCO operates more than 100 corporate auto parts stores and sponsors the CarQuest Inc. distribution program in Texas.
The company began distributing tires in the early 1930s and, in 1989, created the ACCC dealer marketing program with Manassas, Va.-based Merchant's Inc. The Memphis, Tenn.-based dealer marketing organization now consists of 18 member-distributors and more than 830 outlets in all 50 states.
TASCO's acquisition has the potential to significantly boost ACCC's membership in Texas, according to ACCC Vice President and General Manager Dennis DeLeonard, who said the marketing group originally put the two firms in touch with one another.
TASCO has signed a letter of intent to become an ACCC member-distributor pending approval by the ACCC board of directors, expected to come at the board's February meeting, Mr. DeLeonard said.
TASCO's network of more than 300 independent tire dealers service nearly 300,000 Farm Bureau members, Mr. Catchings said. Those dealers, as well as STRAFCO's former dealers, will be able to apply for the ACCC program.