Equity firm acquires Alloy Wheel Repair

NEW YORK (Nov. 17, 2015) — Private equity firm Soundcore Capital Partners L.L.C. has completed its acquisition of Alloy Wheel Repair Specialists, which it called the world's largest full-service alloy wheel repair and replacement company.

New York-based Soundcore said the deal marks its first platform investment since the firm's launch last April. Terms of the private transaction were not disclosed. The company's investment team is Jarrett R. Turner, managing partner and founder, and John G.R. Gabler, associate.

Norcross, Ga.-based Alloy, founded in 2001, provides on-site repair of cosmetic damage to alloy wheel cores, off-site remanufacturing of structurally damaged wheels, and OEM replacement parts through a retail network. The company and its franchisees currently operate in 47 U.S. states and 15 countries, servicing more than 8,000 auto dealerships, collision shops, tire dealership accounts, rental car agencies, auctions and automotive centers, as well as retail consumers.

Wheel repair is among the fastest-growing sub-sectors within the auto-reconditioning market, according to Soundcore, accounting for more than $750 million in annual revenues in the U.S. alone.

“We are very excited to announce Alloy Wheel Repair Specialists as Soundcore's first-ever platform investment,” Mr. Turner said. “Alloy is perfectly aligned with our focus on founder- and family-owned businesses in fragmented industries, with stable, recurring revenue, where we can drive growth through accretive add-on acquisitions and operational improvements.” He noted that Alloy executives have “built a market-leading company and we look forward to accelerating Alloy's growth.”

On closing of the transaction, Alloy founder Tom Morris stepped from his leadership role. Rob Wheeley, one of the company's franchisees, has been appointed Alloy's CEO. Soundcore added that Mr. Morris will retain a minority stake in the business and join the board of directors. Two well-known industry veterans, Ken Walker and Bill Lasky, also have joined the Alloy board.

Mr. Walker was formerly CEO of Meineke Car Care Centers, Driven Brands Parts Inc., and Cardis Corp., and is a past vice chairman of AAA and past chairman of the International Franchise Association. Mr. Lasky, a Soundcore operating partner, has been appointed chairman of the board. He has more than 40 years of experience in the auto industry, including senior executive or board positions at Stoneridg, Inc., Accuride Corp. and Affinia Group Inc.

Mr. Wheeley said he is “very fortunate to be stepping into a great situation at Alloy. There is a tremendous opportunity for Alloy to grow organically and through strategic acquisitions.

“With Soundcore's resources and the experience that Ken Walker and Bill Lasky bring, we have a huge advantage to make investments in the business that really matter, enhance our operational execution and really outpace the competition.”

“Finding the right owner — who respected the company and the people who built it and who would responsibly guide it into its next stage of evolution — was very important to me,” Mr. Morris said. “Jarrett and the Soundcore team were incredibly transparent and acted with integrity throughout our discussions, so I am very happy to hand them the keys and am eager to work alongside them as Alloy grows and continues to lead the wheel repair industry.”

Soundcore was advised by Kirkland & Ellis and KPMG.

Founded in 2015, Soundcore specializes in control equity investments and leveraged buyouts of lower middle market North American-based (U.S. or Canada) businesses that have proven franchises. The firm said it partners “with exceptional management teams to create long-term value for investors through a combination of operational improvements, internal growth initiatives and strategic acquisitions.”

The company said it is particularly interested in businesses whose management team members and/or selling shareholders “wish to have a meaningful ownership stake in the newly acquired enterprise.” The firm focuses on proprietary deal sourcing through industry relationships and investment brokers rather than traditional bank auction processes.

According to Soundcore, Alloy's business consists of hundreds of professional, experienced, operators and technicians who provide expert wheel repair and replacement around the globe. The company is rapidly expanding its geographical footprint domestically and internationally to meet the growing demand for full-service alloy wheel repair services.