Les Schwab Sold to Investment Firm
Les Schwab Tire Centers Inc., the nation's fifth-largest independent tire dealership founded by one of the industry's giants, has been sold to the Meritage Group LP, a California-based investment group.
The sale comes nine months after the Les Schwab family announced it was looking for a buyer for its 438 stores in the western U.S. The sale process was delayed due to the COVID-19 pandemic, officials told Modern Tire Dealer in June.
In a Sept. 29 statement, Les Schwab CEO Jack Cuniff said, “The decision to sell has always been about securing the long-term success of the company. Meritage Group has a history of preserving culture and values while growing its companies with investment over time. This is a great fit, and aligns well with Les’ vision and all we have built together.”
When the company announced the sale in December, it noted the difficulties of five generations of the family operating the business, and how that was further complicated by the dealership's size and position in the market.
In a joint statement, family shareholders said, “As our family grows and ages, it has been very important to us to remain committed and aligned behind our Grandfather’s vision. While it was hard to make the decision to sell the company, we are very confident Meritage Group will continue that commitment and alignment, and will build on all we have accomplished over the past 68 years.
“We are thrilled with this outcome,” they said. “The company’s long-term outlook, the opportunities for employees, and the tremendous importance of our customers will remain as Grandpa always imagined.”
Les Schwab founded his dealership in 1952 in Prineville, Ore. It grew to be one of the state's largest businesses as it expanded throughout western states.
Meritage Group was founded in 1997 and is a family-owned private investment firm. It was created by Nat Simons, and the company says it invests in both public and private companies in a variety of sectors. It has an existing base in Oregon. It acquired Columbia Distributing, a national beverage distributor, in 2012.
“We see Les Schwab Tires as an ideal investment,” said Aubrey Barth, Managing Director of Meritage. “The company’s exceptional employees and programs, strong financials, and respected, customer-focused brand set it up for success for years to come.”
Alex Magaro, co-president and senior managing director of Meritage, said, “It only took reading 50 pages of Les' book to realize the Company was a great cultural fit for Meritage."
The sale is expected to be completed by the end of 2020. Meritage says Les Schwab’s operations and management team will remain unchanged.
The purchase price is not being disclosed. In December, Bloomberg News reported the owners hoped for $3 billion.
Les Schwab holds the No. 5 spot on the MTD 100, and founder Les Schwab, who died in 2007, was named MTD's Tire Dealer of the Year in 2000.