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Zafco buys Martino Tire, preps Armstrong relaunch

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CLEVELAND—International tire distributor Zafco Trading L.L.C. has acquired most of what remains of Miami's Martino Tire Co. as part of its strategy to get more firmly established in the U.S. ahead of the re-launch next year of the Armstrong brand.

The Martino Tire acquisition, for an undisclosed sum, gives Zafco five retail stores and one commercial tire center in the Miami area. The stores continue to do business as Martino Tire, according to Carl Casalbore, vice president of sales for ZTI Tires Inc., Zafco's Doral, Fla.-based distributor.

Goodyear took over five other Martino Tire locations in the Miami area on which it held the leases and is operating them as Goodyear Auto Centers.

The purchase fits in with Zafco's strategy of “controlling the brand” from manufacture to final sale, Mr. Casalbore said.

Separately, Zafco has opened a warehouse in Doral, which also serves as ZTI's headquarters.

Zafco is a Dubai, United Arab Emirates-based tire and car parts distributor with wholesale and retail holdings in the UAE, wholesale subsidiaries in India, Russia, Thailand and the U.S. and distributors in more than 80 other nations.

Zafco's strategy is simple, Mr. Casalbore said: “Control the brand.”

That strategy will put the Armstrong brand—mothballed by Pirelli Tyre S.p.A. for most of the past decade—in the company's premium position, he explained in a conversation during the recent International Tire Exhibition & Conference (ITEC) in Cleveland.

It will be complemented by the firm's Zeetex brand in the value position and the Accelera and Forceum brands—products of Thailand's P.T. Elangperdana Tbk. tire maker that ZTI distributes in North America—in the more entry-level positions.

To ensure sufficient control over the Armstrong brand, Zafco has acquired an undisclosed ownership stake in Thailand's Otani Tire Co. Ltd. and secured a contract with Otani to make Armstrong-brand truck, bus and agricultural radials for Zafco starting next year, the first lines in Zafco's re-launch of the Armstrong brand,

Zafco continues to negotiate with undisclosed parties for supplying Armstrong-brand car and light truck tires, Mr. Casalbore said.

Zafco agreed to pay Pirelli at least $5 million to license and eventually acquire the Armstrong brand.

The Martino family, founders and until two months ago owners of Martino Tire, are no longer active in the tire business. The sale comes two years after Martino sold or closed a dozen stores and retrenched its business to a dozen stores in and around Miami.

At its peak six years ago, Martino Tire operated 27 retail and commercial stores and had an active wholesale business, which it sold in 2007 to American Tire Distributors Holdings (ATD) Inc.

Martino Tire was established in 1959 by Sal and Andy Martino, immigrants from Haiti.

Zafco/ZTI plans to grow the Martino Tire retail business again, Mr. Casalbore said, but it's too early to discuss specifics.

In a separate release, however, software provider Aftersoft Network N.A. said Zafco/Martino plans to build the store network back up to 27 stores and three warehouses by 2015. Zafco has agreed to use Aftersoft's VAST Enterprise software to enhance and improve operating processes and sales management capabilities, according to Aftersoft.
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