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MIDAS

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198 reviews

About MIDAS

Midas hopes to apply a golden touch to the car repair business. In addition to focusing on brake and exhaust system services, the company's facilities offer routine maintenance (oil changes, fluid replacements) and work on suspensions, shocks, and struts. The Midas network includes about 1,480 franchised and company-owned stores throughout the US and – more... Canada, as well as some 775 locations in more than a dozen other countries. (Midas' North American stores account for about 98% of total sales.) In addition to these, the company has 160-plus quick-lube and maintenance shops operating under the SpeeDee Oil Change banner in the US and Mexico. Automotive company TBC Corporation owns Midas.

Tire distributor TBC in early 2012 bought Midas in an all-cash deal valued at about $173 million, plus $137 million in assumed debt. (The $11.50 per share offer represents a 75% premium over Midas' closing price on August 11, 2011, the date on which Midas announced that it was exploring strategic alternatives.) The move made Midas a private company ultimately owned by Sumitomo Corporation.

Besides Midas indicating that it was ready to consider selling itself, TBC was attracted to Midas for its size and brand-name strength. One of the company's primary profit drivers has been location count. But the Midas stores network has dwindled in recent years in response to global economic woes that caused consumers to put off car repairs and maintenance. More than 30 franchised Midas and SpeeDee locations were shuttered in 2011. Overall revenue also dropped about 5% in 2011 vs. 2010. The largest slips were among its company-operated shop retail, which accounted for 37% of 2011 sales, down from 40% in 2010.

Midas has also admitted that its company-operated shop business as a whole is unprofitable, and it has been working to turn those operations around through refranchising. The move has already spurred an uptick in franchise royalties and licensing fees from 28% of revenue in 2010 to 29% in 2011. (Midas itself has come to own many unprofitable locations from troubled multi-shop licensees; the company has bought undesirable locations in a bid to protect its markets.)

Compounding its problems, Midas' bottom line plunged into the red in 2010 because of a legal battle. The company paid $25 million in damages to MESA, an Italian firm that runs Midas shops in Europe. MESA successfully argued that Midas failed to cooperate in improving its European IT systems. The expense caused Midas to violate its loan covenants, however, creditors waived the violation and amended their credit agreements.

Despite moving into loss-making territory, the company has seen growth from its co-branded Midas-SpeeDee shops, of which there are 75 in North America. (Midas acquired the SpeeDee Oil Change and Tune-up shop network for about $20 million in 2008.) Midas' co-branding plan allows franchisees to convert their existing locations or open new shops under the combined Midas-SpeeDee banner. The hope is that by offering tune-ups and repairs in the same place, co-branded locations will be able to attract more customers. Indeed, co-branded locations have seen double-digit sales growth since the concept was introduced. During 2011 more than 50 Midas shops added the SpeeDee banner. About 20 SpeeDee shops added Midas repairs and services. The company expects to increase this co-brand shop count by a whopping 100 locations during 2012, mostly through existing Midas franchisees adopting the co-brand format.

Once known as the muffler replacement king, Midas has broadened its slate of services as original equipment manufacturers have made longer-lasting exhaust systems for cars and trucks. Exhaust systems accounted for about 11% of the company's US retail service business in 2011 vs. about 43% in 1991. During the same time period, New Midas categories, defined as general repair, climate control services, and heat exchange products, rose from a mere 3% in 1991 to 48% in 2011. The move is part of a shift in emphasis from repair to maintenance, which tends to involve more repeat business. It has added tire and brake services to its list of offerings, which already includes fluid replacement. – less

MIDAS Employer Reviews

Automotive Parts Technician (Former Employee), Colorado Springs, COJune 23, 2014
Mechanics Assistant (Former Employee), Toronto, ONMay 27, 2014
Work Experiance. (Former Employee), St. Albert, ABMay 26, 2014
Volunteer as Auto Mechanic Assisstant (Former Employee), Mississauga, ONApril 29, 2014
Manager (Current Employee), PickerningJuly 16, 2013

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