Japan-based Marubeni Corporation has agreed to buy TiAuto Investments, the owner of Tiger Wheel and Tyre.
The deal ends a decade of ownership by Old Mutual Private Equity and Carlyle.
It also marks Marubeni’s first move into Africa’s car maintenance market.
The company already has car maintenance operations in Thailand, Indonesia and Mexico.
Marubeni said it had been studying markets where new-car sales, vehicle ownership and replacement tyre sales were growing.
South Africa stood out because it has the largest automobile market in Africa.
The country’s car maintenance market is also growing at about 6% a year.
Tiger Wheel and Tyre network expands
TiAuto was established in 1967 and operates 161 stores across South Africa, Botswana, Namibia, Zimbabwe and Zambia.
Unlike many competitors that rely on franchises, TiAuto mainly uses directly managed stores.
Marubeni said this allows the company to provide consistent maintenance services and achieve strong sales per store in South Africa.
The company said TiAuto has built a loyal customer base through wheel repair services and a multi-brand strategy offering different products and price points.
Marubeni plans to combine TiAuto’s local strengths with its B-Quik business model from Thailand.
It aims to improve marketing, attract more customers, expand services and grow the store network.
New African growth plan
Marubeni said the transaction is aimed at using its experience to provide higher-value car maintenance services in Africa’s growing vehicle market.
Once TiAuto becomes a consolidated subsidiary, Marubeni’s car maintenance business will grow to about 540 stores.
TiAuto CEO Alex Taplin said the company was delighted to join Marubeni.
“This partnership will help us achieve our goal of significantly expanding our presence across Africa,” Taplin said.
Old owners say goodbye
Old Mutual and Carlyle said TiAuto is a market leader in its sector, generating annual combined group and franchisee sales of about R4.5 billion.
Old Mutual Private Equity’s Jacci Myburgh said the exit showed the value created through partnership and long-term stewardship.
She said TiAuto’s management team had set new benchmarks in service and operational discipline.
Eric Kump, managing director at Alterra Capital Partners, said TiAuto was a world-class Southern African company.
TiAuto’s roots stretch back to 1972, when motor racer Eddie Keizan bought what became Tiger Sport Wheels using prize money from winning the Formula 5000 Championship.