1-800-Radiator continues acquisition trend in a tough market

A relatively new player in the acquisition/consolidation market continues to make a big splash.

The recent acquisition of Tri-US Auto Radiator, a family-owned and operated automotive cooling parts business in New York, by 1-800 Radiator, has increased the company's presence within the New York Market. Tri-US has been in business for 49 years and had approximately $3 million in sales.

Jonathan Carey, an investment banker for BB&T Capital Markets spoke to Aftermarket Business about 1-800-Radiator's recent acquitions. He says 1 800-radiator is a unique player in automotive aftermarket, and notes that they came "from out of nowhere" three years ago and now have about a 17 percent share of the radiator market.

"They've been on a fast-paced acquisition schedule," Carey says. "Essentially, they're paying top dollars for the competitors in a fragmented market. For the individual radiator and air conditioning distributor that's been looking for an exit over the last several years, there hasn't been a good alternative. Now there is. These guys are paying top dollar, which is why this sector is consolidating at a rapid pace."

When asked if he thought 1-800-Radiator's acquisition trend would continue, Carey responded, "Absolutely."

Mike Rippey, the CEO of 1-800-Radiator, adds: "The purchase of Tri-US meets our long-term expansion plans. We look forward to serving Tri US Auto Radiator's customers and to providing them with the same top-level service that they are accustomed to."

In addition to the company's acquisition of Tri-US, 1-800-Radiator recently announced the purchase of AAA Radiator Warehouse, an automotive cooling parts business located in San Diego, Calif. This second acquisition will strengthen the company's presence on the west coast, and illustrates the company's decision to actively pursue a growth model.

"1-800-Radiator franchises are a new way of doing business and are a departure from the big box large distribution service. By having owner-operators servicing targeted geographical areas, customers get a high level of personalized service," says AAA Radiator Warehouse's owner, Blair Laframboise.

For the past 29 years, AAA Radiator Warehouse was a family-owned and operated company with both retail and wholesale divisions. The retail side, Radiator Stores, Inc., and the wholesale side, AAA Radiator Warehouse had several locations throughout Southern California. At the time of sale, the company had 22 employees, many of which are being retained by 1-800-Radiator.

1-800-Radiator sells radiators, condensers, fan assemblies, gas tanks, heating cores, and other new automotive parts. In preparation for the summer months, many of 1-800-Radiator's franchise locations have started selling air conditioning parts. In almost all cases, it provides same day delivery to customers at their businesses or homes within a few hours.

Entrepreneur magazine recently named 1-800-Radiator as the 37th fastest-growing franchise in the nation in their Annual Franchise 500® rankings for 2008.