When Martin Carver signed the deal in early December to sell Bandag Inc. to Bridgestone Americas Holding (BAH) Inc., he felt both sadness and joy, which he likened to what a father feels when he walks his daughter down the aisle at her wedding.
``I have a tremendous emotional attachment to these people here, to my customers, to my employees,'' said Mr. Carver, 58, Bandag chairman and CEO. ``In a lot of ways, I think this company was more my family than my own family.... I will tell you this as well, that also in a wedding it's a celebration. I'm tremendously happy that the groom here is an incredible company, world leader, No. 1 in the business.''
After working 27 years for the company founded by his father Roy, Mr. Carver told Tire Business he knew he made the ``best business decision'' for the firm at this time just as Roy Carver made a decision in the 1960s to turn down a $5 million buyout offer for Bandag from Ashland Oil. To use the wedding analogy again, Mr. Carver said he couldn't have found a better suitor for Bandag than Bridgestone/Firestone (BFS).
``The people here have to be very happy because Bridgestone has a real commitment to this business,'' he explained. ``I think they see it as a business that can thrive, and they're going to commit resources to it.''
When BAH Chairman and CEO Mark Emkes visited with Bandag employees Dec. 5 after the acquisition's announcement, Mr. Carver said employees were ``thrilled'' by the BAH executive's statements.
``He did a tremendous job in reassuring our people that Bridgestone likes this business very much, that the price they paid for it was an indication of that admiration and that they're fully planning on running this as a separate entity reporting to Mr. Emkes directly,'' Mr. Carver said.
He noted that the only obligation BAH has is to pay shareholders $50.75 per share, and yet it has made commitments to building the Bandag brand, keeping the company a separate entity based in Muscatine and leaving wages and benefits unchanged for a year.
``The commitments that these guys have made have gone way beyond anything that we could have expected in a situation like this,'' he said.
Bandag is considered the market leader in the U.S. retread market-products made by its franchisees represent about 45 percent of the commercial tire retread market, according to Bandag and market data. It has 186 franchised dealers in the U.S. and Canada who collectively operate 386 locations, according to a Bandag spokesman.
BFS has a lone Oncor mold cure retread plant in St. Louis and none globally. Hence, the Nashville, Tenn.-based tire maker couldn't offer trucking fleets comprehensive tire maintenance services without a retreading system to complement its new truck tires. The tire maker not only gains a retreading presence from the buyout but also a distribution channel through Bandag subsidiaries Tire Distribution Systems Inc. (TDS) and truck lube operation Speedco Inc.
Goodyear and Michelin North America Inc. have estimated 25- and 17-percent shares in the U.S. retread market, respectively. Mr. Carver said he's never been troubled by competition from the tire manufacturers, calling it a natural extension of their business. However, he did acknowledge that Goodyear and Michelin in particular are formidable rivals.
``I thought we did pretty well.'' he said. ``(Michelin mascot) Bib is a pretty tough match in the wrestling ring, but now Bib's gonna have a sumo wrestler to deal with. We'll see how that goes.''
Bandag was founded in 1958 by Roy Carver. The company went public in 1968. Martin Carver's family owns 28 percent of the stock and has 64-percent voting control, according to a Morgan Stanley Research North America report.
Mr. Carver started with Bandag as vice president of Midtown Ignition in Arlington Heights, Ill., an outlet operated by Heavy Duty Parts, a former Bandag subsidiary. He was named chairman of Bandag in 1981 after his father's death from a heart attack.
Within the Carver family only Mr. Carver's brother Roy Jr. is directly involved in Bandag as a board member and thus was part of the unanimous vote for the company's sale. Mr. Carver said his 79-year-old mother, Lucille, also was supportive of the deal.
``I think she's given me far more rope than I ever deserved, and so she has been an enormous support to me over the years and has basically let me run (Bandag),'' he said. ``I can't ever remember her dressing me down for any decisions I ever made in the business. Probably should have but she was phenomenal.''
Mr. Carver's other brother, John, sold a Bandag franchise he had owned-Eastern Iowa Tire-to an employee years ago and has had no connections with Bandag since.
None of Mr. Carver's four children has expressed interest in running the business even though he said he tried to recruit a couple of them to work for Bandag.
They all are ``fiercely independent,'' just as he was as a young man, Mr. Carver added. Three have careers in New York, Chicago and Las Vegas, and one still is attending high school.
``I had a different job for 10 years before coming here, and I really liked my independence,'' he said. ``I admire and respect that my kids don't want to be under my umbrella or shadow.''