Automotive specialist Halfords is acquiring Lodge Tyre, which will make it the UK’s largest business-to-business commercial tyre provider by revenue.
Halfords will pay £37.2m for Lodge, which trades from 50 garages and 248 mobile vans. The deal will takes Halfords’ garage services business to 656 garages, 253 consumer vans, 440 commercial vans and nine warehouses.
On an annualised basis, the purchase will lift Halfords’ revenues from services to approximately 48% of the group total, compared to 26% in 2020.
Last year Lodge Tyre generated pro forma EBITDA of £4.7m and the group anticipates incremental synergies of £3.8m within five years. The acquisition is expected to be earnings accretive in the first year of Halfords’ ownership.
Halfords chief executive Graham Stapleton said: “The acquisition of Lodge Tyre is yet another example of Halfords’ strategic aim of becoming a motoring services-focused business, and will mean that motoring accounts for over three-quarters of our total revenue.
“The current trading environment reinforces the rationale for building ever-more resilient, needs-based revenue streams, which is exactly what the motoring category offers. Within that, the nature of the commercial tyre market means that it is non-discretionary and therefore extremely well insulated against macroeconomic uncertainty.
“Lodge is an outstanding operation that perfectly complements our existing commercial tyre businesses of McConechy’s and Universal Tyres, and gives us a much greater reach across the UK. We were already the UK’s market-leading motoring service provider to consumers, and this acquisition will also make us the UK’s largest commercial tyre provider.”
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