For the last 5 years, FOCUS and other industry observers have been reporting on a continual increase in Consolidator acquisitions. Looking back at the year 2016, it appears the total number of MSO and single shops acquired by the Big Four Consolidators has peaked. From 2012 through the end of 2015, the number of shops acquired by the Big Four accelerated year over year over year even as the percentage growth rate slowed. But in 2016 the total number of new shops acquired or opened slowed dramatically – down by 40%! In 2017 the decline seems to be even greater.
As consolidation in the collision repair industry continues unabated, consolidation in paint distribution has been accelerating as well. National distributors continue to acquire regional and local jobbers, prompting many jobbers to actively consider what this should signal to them. It’s more than just others selling that is now making a large number of owners look closely... Read more »
The heavy consolidation trend in the collision repair industry continues to be mirrored in the 4,000-outlet, $4 billion paint refinish distribution segment, a new FOCUS Investment Banking report notes.
“There are multiple buyers, many willing sellers, cheap capital and attractive prices,” FOCUS Managing Director David Roberts wrote in a recent study.
The volume of transactions concluded by the Big Four consolidators in 2014 far exceeded any expectations we might have had even as late as NACE in July. Only the consolidators themselves knew the extent of their acquisition possibilities when the year started. When the dust settled, the total number of acquired and new shops for the Big 4 exceeded 374 - on a beginning base of 614 shops. Fifty percent growth in a single year!
Spurred by dramatic growth of large consolidators, as well as many regional and local MSOs, consolidation continues to evolve and impact the collision repair industry. Let's take a look at the numbers on acquisitions, valuations and markets.
Sixteen years ago, after David Roberts and his partner, Matthew Ohrnstein, founded Caliber Collision, he wrote a series of industry articles that were presciently accurate. His subject then? “Shop Consolidation: Is It Inevitable?” His answer was an emphatic “Yes.” Over a period of 8 years as Caliber’s Chairman, Roberts helped lead the initial capital raises and the acquisition of its first 37 shops. Now a leading investment banker in the Automotive Services industry with FOCUS Investment Banking, Roberts has a unique 20-year perspective on the industry. With the dramatic growth of the large consolidators as well as many regional and local MSOs, we asked Roberts to update our audience on consolidation developments, their impact on the industry and how consolidation continues to evolve.