Monro spent $27 million to buy Free Service Tire and others

ROCHESTER, N.Y. — Monro Inc. spent $27.3 million in the quarter ended June 30 to acquire 16 retail stores, four wholesale distribution centers and one retread plant that are expected to generate $50 million or more in annualized sales.

The sum pertains primarily to Monro's acquisition in mid-May of Johnson City, Tenn.-based Free Service Tire Co. Inc., which comprises all the assets acquired except for four retail stores, according to information in Monro's first quarter 10-Q filing with the Securities and Exchange Commission.

The other stores acquired came in the purchase of four retail tire and automotive repair stores in Minnesota from Liberty Auto Group Inc. These stores — in suburban Minneapolis — now operate under the Car-X Tire & Auto name.

Since the close of the quarter, Monro has completed two more acquisition — Sawyer Tire Co. in southwest Missouri and Mayfair Tire & Service Center Inc., a one-store dealership Philadelphia.

Sawyer Tire has eight stores in Missouri — in Bolivar, Greenfield, Hermitage, Lamar, Lebanon, Republic, Stockton and Willard — that Monro is converting to its Car-X Tire & Auto brand.

Monro said Sawyer Tire is expected to generate about $8 million in annualized sales, split 50/50 auto service/tires. It's expected to be breakeven to diluted earnings per share in fiscal 2019.

Monro did not comment on the status of the business' owners.

Mayfair Tire was founded in 1986 by Joseph Hughes Sr., according to posting on Mayfair Tire's Facebook page, which also included an expression of gratitude to customers from the Hugnes and Mirro families.

Monro also said in its 10-Q it has signed definitive asset purchase agreements covering a dozen retail/commercial tire and automotive repair stores located primarily within its existing markets. These transactions are expected to close during the second quarter of fiscal 2019 and are expected to be financed through the firm's existing credit facility, Monro said.