ITASCA, Ill. (July 30, 2004) — Midas Inc. has confirmed the pending sale of its licensed operations in Europe and Latin America by current owner Magneti Marelli, a member of the Fiat Group, to France's Norauto Group.
Midas President and CEO Alan D. Feldman said the Itasca-based automotive service chain is “extremely confident in the ability of Norauto to protect and grow the Midas brand in Europe and Latin America. We welcome the company as a new alliance partner.” He added that the company's licensed operations in Europe “fit well into Norauto's current retail business and its strategic direction.”
After entering into a long-term license agreement in October 1998 with Magneti Marelli, Midas sold its interests in Europe and Brazil to the firm in exchange for $100 million in cash and ongoing royalties throughout the term of the agreement.
There currently are 607 Midas shops in the countries covered by the agreement.
Norauto is a privately held company, based in Lille, France, that operates 351 outlets in France, Spain, Italy, Belgium, Poland, Portugal and Argentina under the Norauto, Auto5, MaxAuto and CarterCash brands. The stores sell over-the-counter parts and accessories in a retail format. Most have service bays for maintenance and repair work.
Under terms of the sale, Norauto will continue to be obligated by the original strategic alliance and license agreements between Midas and Magneti Marelli, according to Midas.
Mr. Feldman said Midas will enter into an agreement with Norauto that contains financial guarantees for continuing royalties to Midas.
At the time of the initial sale in 1998, Midas had 438 shops in Europe—with 187 owned by the company and 251 operated by franchisees. The shops were in France, Belgium, Austria, Italy, Poland, Spain, Switzerland and Brazil. Since then, Midas Europe also has entered Morocco and Portugal.
Midas said the European operations will continue to be based in Monoco.
The auto service provider has more than 2,600 franchised, licensed and company-owned Midas shops in 19 countries, including nearly 1,900 in the U.S. and Canada.