Group Michelin has acquired Blackcircles.com, an Internet tire sales company in the United Kingdom, for 50 million pounds.
Based on the exchange rate on May 6, 2015, the purchase price is $76.2 million.
Michelin says Blackcircles.com is the number one Internet tire retailer in the United Kingdom.
Based in Edinburgh, Blackcircles.com generated £28 million in revenue in 2013, according to Michelin.
The company is run by Mike Welch, its founder. Michelin says Blackcircles.com has enjoyed growth of around 20% per annum since 2008, in particular thanks to its "Click & Fit" formula, which includes the sale of the product and the service.
In the first quarter of 2015, the company’s growth was up 34% compared to Q1 2014. Michelin says the strong development is likely to continue in the years to come, mainly due to the boom in e-business in the UK and the expected consolidation of the leadership position already held by Blackcircles.com.
"I'm delighted to have found in Michelin a partner who shares our passion for customer service, innovation and technology," says Welch.
"The strength of the Michelin Group will allow us to underpin the multi-brand offering that we deploy in each garage, on every street corner. I am convinced that our teams, our customers, our garages and our suppliers will rapidly start to see the benefits of this partnership."
Michelin says the acquisition of Blackcircles.com will enable it to improve the performance of its mix of distribution channels in the United Kingdom, and in particular to develop synergies with its traditional distributor, ATS Euromaster.
In April 2015, Michelin purchased a 40% stake in Allopneus, a French online tire sales company. Michelin says the Blackcircles.com purchase represents another stage in its e-commerce strategy.
“Our strategy illustrates our ambition: to be ever more innovative, efficient and proactive for our customers by offering them products and services suited to individual needs, and by simplifying the entire purchase process, from choosing their tires to having them fitted by professionals,” says Jean-Dominique Senard, CEO of the Michelin Group.
For details on the Allopneus deal, see “Michelin buys into online tire retailer.”