TPG Capital to acquire ATD for $1.3 billion
American Tire Distributors Holdings Inc. (ATD), which is owned by affiliates of Investcorp, Berkshire Partners LLC and Greenbriar Equity Group LLC, has signed a definitive agreement to be acquired by affiliates of TPG Capital in a transaction valued at $1.3 billion.
Additional terms were not disclosed. The transaction is expected to close during the second quarter of 2010 and is subject to customary conditions, including receipt of applicable regulatory approvals.
Charlotte, N.C.-based ATD is the country’s largest independent tire distributor with 83 distribution centers serving 37 states.
"This is an exciting time in the evolution of our company," says ATD CEO and President Bill Berry. “We welcome our new partners at TPG, who share the same vision we do for the continued growth of the American Tire Distributors brand as significant growth opportunities remain and we continue to seize opportunities, such as geographic expansion and online sales."
"ATD is a market leader that has demonstrated its ability to perform well over an extended period of time," says Kevin Burns, a partner at TPG. "We’re investing behind a great management team and we look forward to working with them to continue to expand this successful franchise.”
David Tayeh, a managing director at Investcorp, adds that "over the past five years, management implemented a successful strategy that has built ATD into the leading replacement tire distributor in the U.S.
"We are proud to have partnered with management in the development of the strategy and believe TPG is the ideal new partner for the company to support it through the next stage of its development and growth.”
According to ATD, the transaction has fully committed financing, consisting of a combination of equity to be invested by TPG Capital and debt financing, which will be provided by certain affiliates of Bank of America, Barclays Capital, General Electric Capital Corp., RBC Capital Markets, UBS and Wells Fargo Capital Finance, part of Wells Fargo & Co.
Barclays Capital, RBC Capital Markets and UBS Securities LLC served as financial advisors to TPG Capital in the transaction. BofA Merrill Lynch and Deutsche Bank acted as joint financial advisors to ATD.
"As a result of this announcement, the planned public offering of American Tire Distributors stock will be suspended."