Church Brothers Sells a Controlling Equity Interest to Saugatuck Capital
Dan Hall, President of Church Brothers, a leading provider of collision repair services in Indianapolis, IN, announced July 3 that he has sold a controlling equity interest in the company to Saugatuck Capital, a private investment firm based in Stamford, CT. According to Hall, "I believe there is an opportunity to build a chain of collision repair facilities consistent with our philosophy of providing quality repair service. With Saugatuck’s consolidation experience and our knowledge of the collision repair process, Church Brothers can be at the forefront of the consolidation that is just beginning in our industry."
Church Brothers plans to expand into cities by acquiring premier operators as well as building new shops.
Dan Hall will continue on as the President of Church Brothers and the Company’s management team will remain intact. The Company has named Mr. Jerold A. Gnazzo to the newly created position of Chief Executive Officer. Mr. Gnazzo is the former owner and operator of seven MAACO paint and collision repair centers and most recently was the Registrar of Motor Vehicles for the State of Massachusetts.
Dan Hall states that at this time Collision Team Automotive, dba True2Form remains a corporate entity owned by the four partners that include Dan Hall, Rex Dunn, Chris Getz and Clark Plucinski.
While Saugatuck now owns a controlling interest in Church Brothers, Dan states that he will be more active than ever in acquisitions and management.
NABC PRIDE Award Nomination Form Enclosed
The nomination form for the National Auto Body Council’s (NABC) 3rd Annual PRIDE Awards is enclosed in this issue of INSIGHT.
The PRIDE Award program was designed to recognize businesses, individuals, and groups of individuals who distinguish themselves and the industry by performing humanitarian and/or community service deeds outside of their normal job responsibilities.
In the last two years, eight companies and individuals have been honored for their charitable work.
To be eligible, the individual, group of individuals, or business must be employed in some aspect of the collision repair industry.
All nominations are due by October 3, 1997. The award winners will be chosen by an independent panel of judges representing a cross section of the industry. The 1997 National PRIDE Award winners will be recognized at the Collision Industry Conference meeting held December 3, 1997 in Las Vegas.
Thompson PBE Announces Retention of Financial Advisor, Acquisitions and Management Change
Thompson PBE Inc. has announced that it has engaged Donaldson, Lufkin and Jenrette Securities Corp. as financial advisor to assist its board of directors in the exploration of strategic alternatives available to the company with the objective of maximizing the company’s value for all of its shareholders and other constituents.
Separately the company also announced that it had recently acquired two businesses, located in Fresno, CA and Phoenix, AZ with historical annual revenues of approximately $2 million. The acquired businesses operated two sites prior to their acquisition by Thompson.
The company has acquired four single location businesses during the 1997 fiscal year, with combined annualized historical revenues of more than $10 million.
The company also announced that Ronald P. White, general manager of its southeast division and former president of FinishMaster, the company’s largest competitor, had resigned to pursue other employment opportunities.
John Sheppard, formerly vice president-operations in the Southeast division through October 1996, has agreed to return to the company and will assume the position of general manager of the Southeast division.
Sheppard was most recently employed as a zone vice president of Blockbuster Entertainment, and was also formerly employed by Chief Auto Parts Inc., where he had responsibility for more than 185 branches in a seven-state region.
Keystone Announces Acquisition of All Makes Body Parts
Keystone Automotive Industries today announced the acquisition of All Makes Body Parts, Inc., a Phoenix, Arizona based distributor of automotive collision replacement parts, with revenues approximating $8 million.
Terms of the transaction were not disclosed.
Charles Hogarty, President and Chief Executive Officer of Keystone, said "This is a particularly important strategic acquisition for Keystone as it provides the company with significant geographic expansion in the Southwestern United States, where we had a limited presence."
All Makes Body Parts has facilities in Phoenix, Arizona, Tucson, Arizona, Albuquerque, New Mexico, El Paso, Texas, Las Vegas, Nevada and Denver, Colorado.
The purchase of All Makes Body Parts brings to eight the number of acquisitions effected in the past 12 months. It also brings to 77 the number of service centers Keystone operates throughout the United States with 12 regional hubs.
Republic Industries To Acquire Snappy Car Rental
Republic Industries, Inc. has announced that it has signed a definitive agreement to acquire Snappy Car Rental, Inc. of Tulsa, OK, a leading insurance replacement car rental company, for $26 million in cash or stock, at Republic’s discretion.
Snappy Car Rental is a major participant in the insurance replacement car rental industry, which provides rental cars for drivers whose own vehicles are being repaired or replaced. Snappy has 220 branch locations in 38 states and a fleet of approximately 14,500 vehicles. Snappy is owned primarily by an investor group led by Jacobson Partners, a New York-based investment firm.
The company will join Republic’s other insurance replacement car rental companies, Spirit Rent-A-Car and the Alasys division of Alamo Rent-A-Car.
Steven R. Berrard, President and Co-Chief Executive Officer of Republic said, "The acquisition of Snappy firmly establishes Republic in the insurance replacement business and, when combined with Spirit and Alasys, gives Republic a strong base from which to expand in this growing market."
Benjamin Jacobson of Jacobson Partners, said, "We believe this is an excellent deal for both companies. Snappy will benefit from the substantial resources of Republic, as well as Republic’s position as the major automotive retail and rental company. Snappy’s national branch office system, strong insurance company relationships, information systems capabilities and experienced management team will position Republic as a major factor in insurance replacement car rental."
PPG Reports On 2nd Quarter, Directors Set Dividend
PPG Industries reported today that second-quarter sales and earnings per share were records for any quarter.
Second-quarter net income was $218 million, or $1.21 per share, on sales of $1.94 billion. Net income a year ago was $229 million, or $1.20 a share, on sales of $1.91 billion.
Six-month net income was $384 million, or $2.12 per share, on sales of $3.72 billion. In the first half of 1996, net income was $401 million, or $2.10 per share, on sales of $3.66 billion.
"Europe’s economies are still sluggish although we’ve seen some encouraging signs of recovery there and the North American economy remains healthy," said Raymond W. LeBoeuf, PPG’s president and chief executive officer. "Globally, our focus on high-growth businesses and continuous efficiency improvements in all of our operations are evidence of our long-term commitment to stronger performance and increasing shareholder rewards."
Record second-quarter sales and operating earnings for PPG’s coatings segment were driven by strong volume gains, particularly in industrial coatings. Earnings also benefited from modest price improvements, partially offset by costs associated with new initiatives in South America and Asia as well as in the industrial coatings business.
Glass segment sales and operating earnings were off slightly compared with the 1996 quarter, mainly because of lower prices. However, there were significant improvements in European flat glass and fiber glass volumes. In addition, the benefits of global manufacturing efficiencies in the first six months approached those achieved in all of 1996.
The Colonel’s Announces Termination of Agreement to Acquire Williamson Dealerships
The Colonel’s International, Inc. Board of Directors today announced that it has terminated the preliminary agreement to acquire the new and used car dealerships owned by Mrs. Patsy Lou Williamson, the Company’s Chairwoman.
The Company entered into the preliminary agreement on March 20, 1997 and made a public announcement of the preliminary agreement on that date. At this time, the Company has no intention to acquire any automobile dealerships.
Burt Reynolds, of television and movie fame, has been appointed to the Board of Directors to fill a Board vacancy.
The Colonel’s, Inc., a wholly-owned subsidiary of the Company based in Milan, Michigan, is a leading domestic manufacturer of plastic replacement bumpers and facias for the aftermarket auto industry in North America. The Colonel’s Truck Accessories, Inc., a wholly-owned subsidiary of the Company, produces truck bed liners for sale to new vehicle dealers and in the automotive aftermarket. Brainerd International Raceway, the Company’s other wholly-owned subsidiary, owns and operates Brainerd International Raceway, a multi-purpose motor sports facility located in Brainerd, Minnesota.
Ron Kuehn to Join Body Shop Video’s Business Development Group
Scott Biggs, president of Body Shop Video’s Business Development Group, announced the appointment of Ron Kuehn to executive vice-president of the company starting in August.
Kuehn, who was most recently vice-president of new business development at I-CAR, will oversee sales, marketing and day-to-day operations for the Business Development Group. During his time at I-CAR, Kuehn was instrumental in the launch of I-CAR’s welding certification program and also served as the Western Regional manager for I-CAR.
According to Biggs, "We’re excited to have Ron coming on-board. His wealth of experience in the industry and in education will be a valuable asset for both our company and our members."
FinishMaster Reports Improved Profitability
What a difference a year makes. Tom Young’s appointment as president and chief operating officer of FinishMaster is showing results. FinishMaster, Inc. reported improved results on July 17 for the three- and six-month periods ended June 30, 1997, highlighted by continued higher operating profits and improved net income.
FinishMaster reported net income of $1,004,000, or $0.17 per share, on net sales of $31.0 million for the 1997 second quarter, compared with net income of $699,000, or $0.12 per share, on net sales of $33.1 million for the quarter ended June 30, 1996. The decrease in net sales was attributed to soft market conditions and the loss of certain low-margin business. Despite the decrease in net sales, FinishMaster said approximately half of its 54 outlets posted increased same-outlet sales, reflecting initial benefits from the Company’s recent restructuring.
According to Young, "We are pleased with the progress we have made in the second quarter. Our restructuring into four regional divisions has generated improvements in both our sales and cost-management efforts. Our cost-management initiatives, combined with volume-purchasing strategies, are yielding positive results. In addition to higher profits, we also achieved solid margin increases..."
Gross profit margin as a percentage of sales increased to 37.3% during the 1997 second quarter, versus 36.0% during the same period last year, due primarily to volume purchasing and other incentive rebates.
Operating income rose to $2.0 million, a 16% increase over the comparable period last year, due primarily to Young’s heightened focus on cost improvement. During the 1997 second quarter, FinishMaster reduced operating and selling, general and administrative expenses by approximately $951,000 compared to the same period last year, more than offsetting a $291,000 increase in amortization cost from the comparable period last year. The increase in amortization was the result of the acquisition of additional intangibles and revisions to the estimated lives of certain intangibles.
"Moving forward, we need to complement our cost-management efforts with a sharp focus on selling," Young said. "Our decision earlier this year to reorganize into regional divisions is helping FinishMaster re-establish its local presence in several key markets in order to increase our sales and marketing efforts."
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