Connect with us

News

ATD Expounds on Deal to Purchase Hercules

ATD plans to purchase capital stock of Hercules for $310 million.

Advertisement

American Tire Distributors has entered into agreement with Hercules Tire & Rubber Co. to purchase all capital stock of Hercules for $310 million.

Click Here to Read More
Advertisement

 

"Hercules is a well-run company with an outstanding reputation in the industry," said William "Bill" Berry, president and CEO of ATD, in a statement from the company. “Joining forces with the Hercules team is a very positive step for American Tire Distributors.” 

An 8-K form filed with the Securities Exchange Commission on Jan. 24 briefly outlines aspects of the deal.

According to the 8-K form, ATD plans to buy the tiremaker for $310 million with the deal closing by the end of January. An additional $10 million could be paid “contingent upon the occurrence of certain performance-related and other post-closing events.”

Advertisement

Expected funding for the deal will come from a combination of issuance of additional debt, equity contributors from ATD’s indirect parent, and borrowing under ATD’s credit, the filing states. 

To see the full filing, click here

ATD, which operates 130 distribution centers across the U.S. and Canada, spoke with Tire Review explaining more about what the deal means for it. 

Advertisement

The acquisition of Hercules Tires fits with ATD’s long-term growth plan for the company, said Ron Sinclair, senior vice president of marketing for ATD. 

“Hercules is a well-respected, well-run company. As ATD and Hercules join forces, our mutual customers will benefit from an unsurpassed product offering, outstanding service and delivery, and a broad array of marketing programs,” Sinclair noted.

Both ATD and Hercules’ management teams will be working together in the coming months to develop a clear blueprint to leverage the best practices of both companies, Sinclair said.  

Advertisement

Hercules Tires operates four divisions — Hercules Tire USA, Hercules Tire Canada, Tire Dealer’s Warehouse, and Hercules Tire International. Additionally, the company owns 15 distribution centers in the U.S. and six distribution centers in Canada, as well as the Hercules and Ironman brands. 

“Hercules’ operations in the U.S. and Canada complement ATD’s operations very well. The Hercules team has also done an outstanding job marketing the Hercules brand, which is one of the most sought-after proprietary brands in the industry,” Sinclair said. 

On ATD’s website, the distributor notes that it has grown its business through “decades of acquisitions” as well as other steady growth. One notable acquisition includes that of Am-Pac in January 2009.  

Advertisement

In November 2012, ATD expanded its distribution into Canada with the purchase of TriCan Tire Distributors. The company has since been expanding its presence there, most recently with the purchase of wholesale distributor Kipling Tire Co.

 

Read comments from Hercules here.

Advertisement
Click to comment

POPULAR POSTS

RoboTire-tire-changer-demo RoboTire-tire-changer-demo

News

RoboTire Shows Off Tire Changing Technology at SEMA Show 2021

Sema-Show-Floor 1400 Sema-Show-Floor 1400

News

SEMA 2021: Tire & Wheel Gallery

News

Vredestein Pinza A/T Debuts at Times Square

News

How RoboTire Aims To Transform the Tire Industry

Connect
Tire Review Magazine