A look at the Jim Coleman-Hanna deal
The buzz at this year’s Car Care World Expo undoubtedly will be about the recent acquisition of the assets of Hanna Car Wash Systems, Portland, OR, by Houston-based Jim Coleman Co. In fact, this is going to be the talk of the industry for some time.
There probably has not been this type of union of legendary names in the carwash business since Hanna and Sherman Industries came together a generation ago.
Hanna may not be the carwash monopoly it once was, but its brand recognition is still strong, and this is a great way for Jim Coleman to forcefully enter the conveyor market.
The deal will be great for Hanna and Jim Coleman distributors. They will now have product offerings that span the self-serve, in-bay and conveyor markets, providing excellent opportunities for sales growth.
The deal also is great for Hanna’s future growth prospects. The last two owners of Hanna were investment groups with no real long-term designs on the company.
A group of Texas investors took control of Hanna in the early 1990s after the company had some financial problems, and the same thing happened when Portland development firm The Aspen Group took over Hanna in 2001.
It’s been a long time since Hanna was owned by a real carwash company. Jim Coleman did not buy Hanna to recover debt or treat the firm as an investment – Jim Coleman bought Hanna to grow and strengthen the company, and that will be a nice shot in the arm.
Without a doubt, the deal will have some problems.
Like the sale of Hanna in 2001, this sale was “asset-only,” meaning some Hanna creditors will again be left in the lurch.
It is a perfectly legal way to buy and sell a business, but we can expect some obligatory litigation, similar to what happened four years ago (albeit, probably on a smaller scale, as the company is by all accounts much healthier and stronger now).
Achieving distributor buy-in also will be critical to the long-term success of the deal. Distributors ultimately will determine the success of any carwash manufacturer, and it’s important that the Hanna and Jim Coleman distribution networks be open to expanding their horizons into some new markets.
This probably will not be much of a problem. Jim Coleman’s growth over the past several years has come from a very strong network of distributors, and Hanna’s distributors are a loyal and active group who have unflinchingly weathered their share of changes over the years.
Like any acquisition, there are going to be some messes to straighten out and some rocky integration issues. But, overall, it’s a great pickup for Jim Coleman, which becomes an overnight force in the conveyor market, and, as far as Hanna is concerned, this is one of the best things that could have happened to it.