American Tire Distributors (ATD) and Monro Inc. have entered into a definitive agreement under which ATD will acquire Monro’s wholesale tire distribution assets, operating under the Tires Now name.
Tires Now operates seven facilities across the Southeastern United States, servicing more than 3,500 wholesale customer locations annually. In addition to servicing these wholesale customers, with this transaction, ATD says it also will strengthen its strategic support of the tire business at Monro’s more than 1,300 retail stores. The company says both Monro and ATD, and their respective partners and customers, are expected to benefit from increased operational efficiencies created through this transaction.
Details of the Transaction
Under the terms of the transaction, ATD will pay Monro $105 million in cash for the assets under the Tires Now operations and for certain assets under Monro’s internal tire distribution operations, subject to customary escrow arrangements. The agreement provides that $65 million will be paid at closing and the remaining $40 million will be paid quarterly, based on Monro’s tire purchases from or through ATD in connection with a distribution agreement also being entered into by ATD and Monro.
The transaction is expected to close by the end of the second quarter of calendar 2022, subject to clearance under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976, as amended, and other customary closing conditions.
