EDMONTON, Alberta—American Tire Distributors Inc. (ATD) has acquired the assets of Edmonton-based TriWest Trading (Canada) Ltd., dba TriCan Tire Distributors, in a deal that will expand ATD's distribution services beyond the U.S. for the first time.
The transaction, which closed Nov. 30, gives ATD control of TriCan's 15 distribution centers stretching across Canada from New Brunswick to British Columbia. In a recent 8K filing with the Securities and Exchange Commission, ATD said the deal for TriCan is valued at about $97.5 million, subject to “certain post-closing adjustments.”
Ron Sinclair, ATD's senior vice president of marketing, declined to disclose financial terms of the transaction but told Tire Business that in terms of the structure of the acquisition, ATD financed the buyout through its wholly owned Canadian subsidiary ATD Acquisition Co. V Inc., an entity created specifically for the deal.
ATD Acquisition is purchasing TriCan from an entity known as 1278104 Alberta Inc., which lists TriWest Trading as a wholly owned subsidiary.
Mr. Sinclair said TriCan will continue to operate as a standalone business unit using its distribution facilities, which it leases, while retaining its company name and management team, led by Chris Fletcher, who has served as its president since October 2006.
“As we move forward, TriCan will increase the size of multiple distribution centers and intends to add new distribution centers across Canada via greenfield openings and potentially through additional acquisitions,” Mr. Sinclair said.
ATD plans to begin expanding TriCan's existing distribution centers in 2013 to support a broader product screen offering to customers.
“ATD, TriCan and our vendor partners will work together and, over time, will expand TriCan's brand portfolio and product screen to best serve their customers' needs,” Mr. Sinclair said.
Similar to ATD, TriCan has focused on delivering outstanding customer service, contributing to the firm's significant growth since its founding in 1978 in Calgary, ATD said. The company was acquired by its most recent ownership team in late 2006, after which it expanded to 15 distribution centers today from six then.
“By offering more products from larger distribution centers—while our team continues to deliver unsurpassed customer service—TriCan will further differentiate itself as the leading distributor in Canada,” Mr. Fletcher said.