A Los Angeles investment firm has reached a deal to buy a minority stake in online and mail-order marketer Tire Rack, leaving family members still with majority ownership in the company.
Tire Rack said in April that it had retained financial advisers to find an equity investor so that co-founder Peter Veldman, 79, and his wife Wilma, 78, could retire as well as focus on their charitable interests.
Matt Edmonds, vice president of marketing for Tire Rack, told Tire Business that Leonard Green & Partners L.P. has inked a deal to buy a minority share. The transaction is not closed yet, and Mr. Edmonds said the details will remain private. According to its Web site, Leonard Green, founded in 1989, holds about $3.7 billion in equity capital under management. The firm has invested in about 32 companies with aggregate value of more than $18 billion.
Mr. Edmonds said the remaining family members will continue in their management roles, and he doesn't expect any operational changes at the company as a result of the arrangement. ``That's the beauty of this kind of deal,'' he said. ``You have someone who is investing in the company because they appreciate the management team.''
Besides Mr. Edmonds and the Veldmans, other family members include Tom Veldman, vice president; Mike Joines, vice president; and Mark Veldman, vice president. Peter Veldman and son-in-law Mr. Joines founded Tire Rack in 1979. The company shifted its focus in 1982 to a mail-order operation.
Though the sale of the Veldmans' ownership stake is nearly complete, Mr. Edmonds said the couple still will remain involved in the business. Employees playfully joke that their retirement will mean they're in the office one hour less each day, he said.
``They love this business,'' he said. ``...It is much more than a job. It is their life, and they love it.''