ROCHESTER, N.Y. (Sept. 24, 2009) — Monro Muffler Brake Inc. has agreed to buy Tire Warehouse Central Inc. in New England and completed the purchase of Midwest Tire & Auto Repair in Indiana, expanding the firm's tire group network by 50 stores and adding $60 million in annual sales.
Monro has agreed to pay $34 million for Keene, N.H.-based Tire Warehouse, taking over the dealership's 40 company-owned stores and six franchised locations, a distribution center in Swanzy, N.H., and real estate assets for 12 of the store locations.
The acquisition, expected to close in early October, is part of a plan to boost Monro's presence in New England, the company said. At the same time, Monro plans to convert 50 of its existing Monro service stores in New England to its Black Gold format, which is designed to increase sales of tires and related services in these stores.
Monro management said they expect the Tire Warehouse business to be “slightly accretive” in the first 12 months and to add 6 to 8 cents a share to its bottom line in the second year.
Monro paid $2 million for Schererville, Ind.-based Midwest Tire, picking up four stores and about $6 million in annual sales.
“We believe that the acquisitions of both of these businesses fit well into our stated strategy of seeking value-priced transactions that expand our market share,” said Monro President John Van Heel. “We…look forward to capitalizing on the significant opportunities presented by the addition of 50 stores, nearly $60 million in sales, and an additional 500,000 tire units.”
The latest acquisitions will be funded through the company's existing line of credit. Monro said it intends to retain the store employees of the acquired businesses.
Monro said it expects Midwest Tire, which will be converted to the Mr. Tire brand name, will operate at breakeven in the first 12 months following the acquisition.
Coupled with the acquisition earlier this year of Autotire in St. Louis, Monro has added 76 tire retail stores and $90 million of annual sales this year
Tire Warehouse operates 16 stores in New Hampshire, 12 each in Massachusetts and Maine, four in Vermont and three in Rhode Island.