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February 15, 1999 01:00 AM

HEAFNER BUYS CALIFORNIA TIRE CO.

Vera Fedchenko
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    CHARLOTTE, N.C.—J.H. Heafner Co. Inc. President William Gaither has what you might say is a golden opportunity. His company already has a presence in California after purchasing Winston Tire Co. and Competition Parts Warehouse (CPW) in the past two years. But on Jan. 12 Heafner expanded its wholesale distribution network in the Golden State further by acquiring the San Francisco Bay area's California Tire Co. L.L.C. in Hayward, Calif. Terms weren't disclosed.

    The buyout gives Heafner warehouses in Hayward, Sacramento and Fresno, Calif., and a distribution area that covers 75 percent of California, as well as parts of southern Oregon and northwestern Nevada.

    Heafner's president said the deal reflects the Charlotte-based firm's policy of aggressive but ``intelligent'' growth across the Sunbelt region.

    ``We're the No. 1 distributor in the country, and we intend to push that,'' Mr. Gaither said. ``As long as it makes sense, we intend to keep expanding as fast as we can, but we're not going to get ahead of ourselves.''

    With the acquisition, Heafner operates 10 regional warehouses in California and Arizona, and 59 warehouses on the East Coast, said Dan Brown, Heafner's vice president of sales and marketing.

    Mr. Gaither declined to comment on California Tire's annual sales. But he said Heafner's sales for 1999 ``should be north of $1 billion.''

    Michael Largent will remain as president of California Tire, a position he has held for the past 10 years. The company will operate as a division of Heafner, Mr. Gaither said, and, like CPW, will remain unchanged in its operations.

    California Tire distributes Bridgestone, Firestone, Yokohama, Polaris, Remington, Sigma, Nitto, Falken and Federal brands, Mr. Largent said.

    California Tire chose to merge with Heafner not so much because it already had acquired competitor CPW, but because consolidations are the trend in the tire industry, Mr. Largent said.

    ``It wasn't a matter of us feeling the squeeze; it was a matter of looking at what was going on everywhere in the industry...,'' he said.

    Mr. Gaither admitted California Tire wasn't the only business Heafner was considering, but it was the one acquisition that seemed to fit best.

    ``Everybody's talking to everybody," he said, ``and so you have to pick your spot, choose carefully and proceed intelligently.''

    Although Mr. Gaither believes the California tire market is saturated, somewhat fragmented and highly competitive, there's still room for Heafner to grow in what he called ``the No. 1 market in the world.''

    ``When the Winston acquisition was done, we followed up with some acquisitions to make that one even more valuable to us,'' he said. ``(California) is a great market.

    ``There's some very strong players (but) there's room for some more consolidation.''

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