Reaching the Next Level
Vintage Parts is the leading independent distributor of original slow-moving and inactive OEM replacement parts for automobiles, recreational vehicles, and construction, agriculture, and other industrial equipment. Pursuant to long-term agreements with 66 OEMs, Vintage Parts purchases old-model parts inventories and warehouses them for future sale to more than 75,000 distributors, many of whom are authorized OEM dealers.
Background
Vintage Parts was previously owned by the Swire Group, a privately held $20 billion transnational corporation headquartered in the United Kingdom. Swire owns a range of businesses, and Vintage Parts was an autonomous, noncore asset that Swire decided to divest. Swire chose Sentinel because of our proven record of closing transactions, our rapport with management, and our record and experience with specialty industrial distributors.
Opportunity
- To accelerate Vintage Parts’ growth by adding new OEM partners and expanding its unique distribution model, which had been highly successful in the automotive sector, into new end markets.
- To partner with an experienced and highly motivated management team that had not previously had the opportunity to own equity
Accomplishments
Built Strong Partnership with Management: Sentinel closely collaborated with management to establish growth plans and priorities and to align interests. We also created an incentive program to provide Vintage Parts’ executives with significant financial upside for personal wealth creation.
Added OEMs and Diversified into Non-Automotive End Markets: At the outset, automotive OEMs represented nearly two-thirds of Vintage Parts’ sales. Sentinel worked closely with management to identify new end markets that could leverage Vintage Parts’ distribution model. During our ownership, Vintage Parts added 30 new OEM partners and successfully penetrated the agriculture, construction, heavy-truck, mining equipment, marine, industrial engine, and oil and gas sectors. At the time of Sentinel’s exit, more than half of Vintage Parts’ sales were from non-automotive sectors.
Outcome
During Sentinel’s eight-year ownership, Vintage Parts significantly exceeded the growth objectives established at the outset of our investment. Having substantially exceeded our investment objectives, in 2015, Vintage Parts was sold in a management buyout to another private equity firm.