Les Schwab Tire Centers Inc.’s upcoming acquisition of Plains Tire Inc., a nine-store chain with locations throughout Wyoming, signals the focus on growth through the acquisition of the Bend-based dealership, in Oregon.
The deal, announced earlier this week, is expected to close in August and expands Les Schwab’s presence in Wyoming to 10 locations. (Les Schwabs opened their first store in the state in 2019.)
The terms were not disclosed.
The Plains Tire locations were owned by Larry Nicholls and were part of his Logan, Utah-based Associated Tire Stores Inc. group which also includes Bargain Tire and Discount Tire and Automotive, both of which will remain owned by the Nicholls family. .
Nicholls says being a part of the Schwabs “will create even more opportunities for our employees and I know that our employees, customers and communities will be treated well.
“I don’t think I could have found a better partner than Les Schwab to sell our family’s business and I am delighted to see these stores grow and prosper.
The Plains Tire acquisition “puts us as far east as some of our stores in Montana and Colorado,” says Dale Thompson, Les Schwab marketing director. “It kind of fills that eastern front.”
In addition to Wyoming, Montana and Colorado, Les Schwab also operates stores in his native Oregon, as well as Washington, Idaho, California, Nevada, Utah and Alaska.
Plains Tire has outlets in Laramie, Rock Springs, Gillette, Evanston, Casper, Sheridan, Riverton and Green River, Wyo.
“An established player”
Thompson says Les Schwab will continue to open new stores, but will also pursue acquisition opportunities.
He notes that the company has acquired Les Schwab member merchant stores over the years. (The company has nearly 55 member reseller locations.)
“But we’ve done a lot more organic growth over the past 10 to 15 years.”
Schwab itself was acquired by Meritage Group LP, a California-based investment firm, in September 2020.
Meritage “encouraged us to grow and they wondered why we hadn’t used acquisitions more in the recent past,” said Thompson.
“We have always looked for growth opportunities and historically we have been rather greenfield. And they asked, “Why not (make) more acquisitions, as well as new creations?” And that’s what we do. We’re looking at both avenues right now.
There are several advantages to entering a new market by acquiring an existing dealership, according to Thompson.
“When we looked at Wyoming, we had a store there. Now we have 10 so speed is a plus. I also think that when you look at our (recent entry into) the community, it makes it difficult when it comes to zoning.
With Plains Tire, “we have an established player in the market. And I also think the reputation established from the ground up and building the brand… that would be one of the biggest benefits. “
No decision has yet been made regarding the branding of Plains Tire.
“We’re going to run them as is and find the best way to integrate the two systems (of the dealers) and that’s our plan,” says Thompson.
Companies share the same philosophy when it comes to customer service, employee relations and community engagement, he adds. “This kind of alignment with our strategy creates a very good fit and what we think is a great opportunity.”
Asked about future acquisitions, Thompson declined to comment on details, but mentioned that Les Schwab “looks for well-run, well-respected companies that align with our strategy: a strong brand, well respected by the community – these are the things we think we align well.
The acquisition of Plains Tire gives the Schwabs 453 company-owned outlets, making it the fifth-largest independent tire dealer in the United States, according to the MTD 100 2021, which appears in the July issue of MTD.
Les Schwab, who won MTD’s Tire Distributor of the Year award in 2000, founded the company in 1952.