Stealth Global Holdings to acquire Heatley Sales for A$4.2 million

SYDNEY, AUSTRALIA: Stealth Global Holdings’ subsidiary, Heatley Sales Pty Ltd has reached an agreement to acquire the business assets of Skipper Transport Parts (STP) for A$4.2 million.

STP is currently an operating division within AMCAP, a subsidiary of Eagers Automotive Limited, Australia’s largest automotive retail group.

STP is a market leading distributor of Industrial MRO supplies with significant exposure to customer markets: Automotive, Truck & Trailer, Mining, Bus, Agriculture and Industrial in Western Australia and Queensland; which includes the formerly four COV’s and Coventry’s Automotive branches which were rebranded in 2016 to Skipper Transport Parts.

STP operates a network of five physical company branch stores in Western Australia including Perth and regional locations in Albany, Esperance, Karratha and Port Hedland. A further twelve onsite store operations exist at customer locations in Western Australia and in Queensland.

STP is a strategic fit and highly complementary to the existing Stealth businesses and expected to deliver significant upside and enhanced market relevance from increased scale, diversification across products, customer channels, geography, and suppliers.

$10 million of identified run-rate revenue synergies is estimated to be driven by broader product offering, cross-selling in existing and new customer markets, geographic expansion, growing the physical branch and onsite store network, increased volume buying power, and operating leverage from the new combined capabilities of the Group once network integration is deployed.

STP and Stealth’s subsidiaries ‘Heatleys’, ‘ISG’ and ‘C&L’ operations will bolt on and use its combination of wide-range product and high-touch solutions models to cater to all customers and cross-sell the extended new range of products and services across all operating businesses.

Capitalising on this advantaged position, it is expected to accelerate favourable market share gain across customer markets and with leading supplier brands, providing the basis for ease of integration, synergies, and expansion across the operating businesses. Stealth’s combined Australian business of company operated branch store locations will now include Perth, Albany, Bunbury, Esperance, Kalgoorlie, Karratha, Port Hedland, Adelaide, and Brisbane.

The geographical reach in Western Australia alone pivots Stealth into a market leading position. The commencement of stock relocation from AMCAP’s Distribution Centre to Heatleys main Distribution Centre is scheduled for late July followed by integration programs.

Stealth Group Managing Director Mike Arnold said: “The acquisition of Skipper Transport Parts fits Stealth’s stated strategy to expand its business through disciplined organic and acquisition growth plan. The STP purchase and merger is transformational in terms of a significantly expanded product and high-touch solutions offering, distribution supply chain infrastructure, eCommerce platform and deeper customer and supplier relationships.”

“STP’s physical branch and onsite stores network will allow us to enter new geographic markets to strengthen our market position and provide an endless assortment product offering suitable for customers of all sizes. Our strict criteria on strategic fit, price and delivering on long term value to our shareholders is always at the core of our decision making. Skipper Transport Parts meets these requirements.”

“STP is highly regarded as a market leading business in Western Australia and for its onsite solutions to customers. The depth of STP’s wide-ranging Industrial MRO products in the customer markets of Automotive, Truck & Trailer, Bus, Agriculture and Mining, complemented with Stealth’s existing business, will give the merged group significantly more scale and leverage from its distribution platform, branch store footprint, network reach, buying power and its broad in-stock product offering where Stealth can hold an advantaged market relevant position.”

“Importantly, comprehensive value is created by offering our customers an endless assortment of brands, products and solutions that deliver better customer experiences with more touch points in store, onsite, online, click & collect and delivery options, supported by experienced sales, service, technical and distribution professionals.”

“Stealth is well positioned to continue growing its business and capitalise on investment and growth opportunities over coming years, with a focus on capital discipline. This is underpinned by our expanding diversified business portfolio, resulting in a steady flow of recurring sales activity.”

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