RPM ACQUIRES EAST COAST TYRE WHOLESALERS
This is RPM’s third acquisition since securing capital in January 2021
The RPM Automotive Group has established itself as a leader in the Australian Automotive Aftermarket.
The group includes a range of businesses that address everything from mechanical repairs to motorsport apparel and safety equipment. Now RPM is announcing a new addition with the acquisition of East Coast Tyre Wholesalers (ECTW).
This Sydney-based tyre and wheel importer already has a nationwide distribution network in place. The Australia-owned company has been trading for over 13 years.
RPM plans to integrate the business into its existing RPM Wheels and Tyres division. The asset purchase agreement totals $2.6 million with 67.5 percent in cash and 32.5 percent in equity. The acquisition will be effective September 1, 2021, and ECTW will retain its management team.
RPM is excited about the benefits of adding ECTW to its roster. This includes expanding RPM’s presence in New South Wales. The RPM Wheels and Tyres Division will now have operations that essentially cover the East Coast of Australia.
ECTW is also the exclusive distributor of several Passenger Tyre Brands, including Pace, Compasal and Zeta Truck Tyres. RPM states that ECTW is able to supply Passenger Tyres from 12 inch to 22 inch in size, with a full range of PCR, UHP, 4WD, TBR and Run-flat Tyres.
RPM is also looking at potential revenue synergies from cross-pollinating customer-bases and cross-selling both RPM’s and ECTW’s current product ranges. On the other hand, ECTW will benefit from the larger infrastructure and greater coverage that RPM offers.
“I am delighted to welcome East Coast Tyre Wholesalers to the RPM fold. Our businesses are operationally aligned, often in parallel markets and tyre segments. We see attractive potential to add value and revenue to both businesses through cross-selling of products and tyre brands to different customer bases, as well as cost synergies as a result of the scale achieved,” RPM Chief Executive Officer, Clive Finkelstein, said.
“This acquisition is funded from our recent capital raise and will be immediately earnings accretive. It is another example of our sustainable growth strategy designed to grow RPM into Australia’s leading business operating a diversity of brands across the transport and automotive aftermarket sectors.”
ECTW is the company’s third acquisition following a successful round of capital raising in January 2021. RPM states that the acquisition of ECTW is strongly aligned with its goal of expanding the Group’s Wheels and Tyres wholesale and distribution platform. It’s also part of the company’s overall growth strategy with additional potential acquisitions on the horizon. RPM has stated that it remains on track to generate record results in FY21, with FY22 Group Revenue forecast to exceed $75 million.
For more information visit www.rpmgroup.net.au