Mavis is a leading independent tire retailer and wholesaler.

www.mavistire.com

Investment

C$151 million

Fund

ONCAP III

Period

October 2014 – March 2018

ONCAP Team

Michael Lay
Stephen Marshall

Mavis Discount Tire image

Transaction Summary

ONCAP invested in Mavis Discount Tire (“Mavis”) to acquire a minority stake from the company’s founders. The founding partners maintained a majority ownership interest. Subsequent to the initial investment in Mavis, ONCAP partnered with the founders to acquire Somerset Tire Service, Inc. (“STS”), which has a contiguous footprint to Mavis, doubling the size of the company.

Business Description

Based in Millwood, New York, Mavis is a leading independent tire retailer and wholesaler. The company has more than 400 tire retail locations across five states including New York, New Jersey, Pennsylvania, Connecticut and Massachusetts. Mavis has approximately 3,500 employees and sells more than three million tire units annually.

Accomplishment and Outcome

Mavis is a leader in its industry with several attractive investment attributes including:
(i) strong free-cash-flow characteristics; (ii) a proprietary operating system which results in higher unit volumes per location and higher margins than its competitors; (iii) an experienced management team; (iv) diversity by site, customer and supplier; and
(v) a compelling growth profile. ONCAP’s investment thesis is to leverage Mavis’ current infrastructure and operating system to build a larger, more geographically diversified retail tire business through new store openings and add-on acquisitions in both new and existing markets.

In March 2018, ONCAP completed the sale of Mavis, generating a total of C$519 million of realized proceeds, which represents a 3.8x gross multiple of invested capital and a 53% gross IRR over the four-year investment period.