Icahn buying Precision Tune Auto Care

NEW YORK — Icahn Enterprises L.P. is buying Precision Auto Care Inc., a franchising enterprise with more than 250 franchised and company-owned Precision Tune Auto Care-branded retail locations throughout the U.S., for $37 million.

Icahn Enterprises — which already has more than 1,000 Pep Boys and Auto Plus stores under its wing— said it plans to continue using the Precision Tune name for the acquired stores and is looking forward to working with the enterprise's franchise owners to grow the brand.

"The acquisition of Precision Auto Care…is the next step in building out our national automotive service network," said Daniel A. Ninivaggi, CEO of Icahn Automotive Group L.L.C., the entity overseeing Icahn Enterprises' automotive aftermarket interests.

Icahn said it expects to close the deal immediately after a special shareholder meeting to ratify the merger, "or as soon as practicable thereafter."

There's been no date set yet for that meeting.

Of the roughly 250 Precision Tune Auto Care centers in operation in the U.S., 43 are owned by Precision Auto Care, according to the firm's financial filings. There are approximately 65 more locations outside the U.S., including five in Mexico.

For the nine months ended March 31, Precision Auto Care reported net income of $640,000 on revenue of $21.8 million. Franchise royalties accounted for 28 percent of revenue, with the company-owned store operations the rest.

"Coupled with our existing footprint of more than 1,000 corporate-owned locations, as well as our in-house automotive parts and tire distribution capabilities, we are uniquely positioned to provide high-quality parts, tires and services to our customers at the most competitive price."

Robert Falconi, president and CEO of Precision Auto Care Inc., will continue as CEO of Precision Auto Care under Icahn's ownership, Mr. Ninivaggi said.

Precision Tune Auto Care was founded by Bill Childs, who opened the first location in 1976 in Beaumont, Texas, and started franchising the concept in 1977.

Precision Auto Care Inc. was established in 1997 via initial public offering, instituted by the President and CEO Jay Ripley.

Today the company has service locations in 26 states, with concentrations in Georgia and North and South Carolina.

The company-owned store locations generated about $385,000 in revenue per store, according to the firm's financial statements.

Disclosure of Icahn Enterprises' intent to buy Precision Auto Care comes just 10 days after Brent Windom, president and CEO of Auto Plus/Pep Boys for the past year, left Icahn to become president and chief operating officer of Uni-Select Inc.

For now, Mr. Ninivaggi is overseeing the Auto Plus/Pep Boys operations, Icahn said.

Other key executives in place at Icahn Automotive include Bill Ihnken, president – service, and Wade Sharp, president – retail/tires. Mr. Ihnken joined Icahn in January as part of Icahn's purchase of Just Brakes. Mr. Sharp was a regional vice president with Advance Auto Parts before joining Auto Plus in 2014; Icahn bought Auto Plus in 2015.