CHARLOTTE, N.C.American Tire Distributors Holdings Inc. (ATD) chalked up its second major acquisition of the still-new year with the signing of a deal Feb. 19 valued at $345 million to acquire all of the outstanding capital stock of Alliance, Ohio-based Terry's Tire Town Holdings Inc.
ATD said it expects the deal will become final in late March or early April. The purchase price could be as much as $20 million higher, contingent on certain post-closing events, according to a Form 8-K ATD filed with the Securities and Exchange Commission.
Early in February 2014, ATD completed its $311.5 million acquisition of Findlay, Ohio-based Hercules Tire & Rubber Co., a tire distributor, importer and private brander.
Founded in 1972 as a single retail store, Terry's Tire Town operates 10 distribution centers serving customers throughout 15 Eastern Seaboard, New England and Midwestern states, along with a single commercial tire operation. The collective warehousing space is 975,000 square feet, with an inventory of more than 1 million tires, Terry's said.
Terry's annual sales were not disclosed.
Until the deal for Terry's is closed, ATD and the dealership will operate independently, according to Ron Sinclair, ATD senior vice president of marketing.
Even after the closing, it will take some time to develop the blueprint for combining the best practices and best people from both companies, Mr. Sinclair told Tire Business.
ATD has not decided whether Terry's Tire Town distribution centers will continue to operate under the Terry's name, or whether it will ask current Terry's Tire executives to stay on after the acquisition is completed.
Those executives include Terry's Tire Town President and CEO Will Tollerton, whom Tire Business unsuccessfully attempted to reach several times before presstime.
Terry's first moved into wholesale distribution in 1984. Over the years, the company expanded from its Ohio roots into metropolitan New York, New Jersey, New England and the mid-Atlantic. A 2010 recapitalization led by Talisman Capital Partners expedited the expansion, as did its acquisitions of Summit Tire of Massachusetts and Englewood Tire Wholesale in 2011.
Also that year, Terry's exited the retail business after selling its seven retail stores in and around Alliance to Monro Muffler Brake Inc. to focus its attention on its wholesale and commercial tire businesses. Monro then began operating the Terry's Tire Town Auto Service Centers as part of its Mr. Tire retail store network.
With its acquisition of Terry's Tire Town, ATD will enhance its ability to serve tire and automotive service retailers in the New Jersey, Long Island and New England markets, the company said.
Terry's warehouses are in: Westbrook, Maine; Nashua, N.H.; East Taunton, Mass.; East Hartford, Conn.; Bethpage, N.Y.; Lyundhurst and West Depford, N.J.; Odenton, Md.; Richmond, Va.; and Alliance, Ohio.
ATD has warehouses close to Terry's distribution centers in eight of the 10 locations.
The opportunity for ATD and Terry's Tire Town to join forces is very positive for the future of both companies and for our customers, said ATD President and CEO William Berry.
ATD operates 152 distribution centers, including 28 in Canada, and is on track to report $3.7 billion in sales for fiscal 2013. It serves approximately 72,000 customers in both countries and employs about 3,800.
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