ATD Corp., the parent company of American Tire Distributors, filed a registration statement with the U.S. Securities and Exchange Commission (SEC) on June 16 relating to a proposed initial public offering of its common stock. The numbers of shares to be offered by ATD and its shareholders, as well as other considerations such as the price range, stock ticker symbol and listing exchange, have not yet been determined.
According to a recent Reuters report, the company could raise up to $100 million in an initial public offering. Renaissance Capital, in an article on NASDAQ, believes that this deal size is likely a placeholder.
“We estimate it could raise $500 million or more,” said Renaissance Capital’s report.
The company originally filed for a $230 million IPO in February 2010 as American Tire Distributors. However, TPG Capital LP acquired ATD in 2010 for $1.3 billion from a consortium of private equity firms that included Investcorp, Berkshire Partners and Greenbriar Equity Group.
Since then, ATD has acquired seven other companies. ATD reported fiscal 2013 net sales of $3.8 billion and earnings before interest, tax, depreciation and amortization of $169.4 million.
Earlier this year, ATD agreed to acquire Terry’s Tire Town Inc. for $365.6 million and Hercules Tire for $311.5 million, according to regulatory filings. Moody’s Investors Service Inc., a credit ratings agency, said in March it expected ATD to successfully integrate Hercules and Terry’s Tire Town and deliver through earnings growth during 2014 and 2015 while maintaining adequate liquidity.
ATD did not say which exchange it intends to list its common stock on but noted that it plans to use the proceeds for working capital, general corporate purposes and to repay a portion of its existing debt.
BofA Merrill Lynch, Deutsche Bank Securities and Goldman, Sachs & Co. are acting as joint book-running managers and as representatives of the underwriters for the offering. In addition, Barclays, J.P. Morgan and UBS Investment Bank are joint book-running managers for the offering.
