Mace Security International To Acquire Wash Depot Holdings
9 March 2000
Mace Security International To Acquire Wash Depot Holdings, A Car Wash Chain With Annual Revenues Of $109 Million
MOUNT LAUREL, N.J., March 9 Mace Security International,
Inc. (Mace) today announced that it has signed a definitive
purchase agreement to acquire Wash Depot Holdings, Inc. (Wash Depot), an
operator of 73 car wash locations in 15 states. Wash Depot, a private company
headquartered in Saugus, Massachusetts, presently generates annualized
revenues of approximately $109 million. At the completion of the transaction,
Mace will become the largest car wash chain in the United States operating 134
car wash locations in 18 states. The Company will be washing approximately 10
million automobiles annually, and servicing approximately 20 million customers
annually through its car washes and ancillary car care services. On an
annualized run rate basis, Mace anticipates revenues of approximately $170
million and EBITDA of approximately $34 million after planned synergies are
achieved. This is a 178% increase to Mace's current total in annualized
revenues, and a 240% increase to Mace's current total in EBITDA.
Pursuant to the terms of the agreement, David T. Smith, founder, Chairman
and Chief Executive Officer of Wash Depot, will become Mace's President and
Chief Operating Officer. Mr. Smith has over 25 years of extensive experience
in the acquisition, development, sale and management of real estate assets
including residential properties, shopping centers, office buildings and car
wash facilities. Previously, Mr. Smith was the founder, Chairman and
President of American Home Shield Corporation, a publicly-traded insurance
company serving the real estate industry. Mr. Smith will be responsible for
overseeing Mace's day to day operations and implementing operational policy.
Closing under the agreement is subject to several conditions, including
Mace and Wash Depot shareholder approval, lender consents, review of
information to be exchanged between Mace and Wash Depot, antitrust clearance
and other typical closing conditions. Though Mace is optimistic that closing
will occur, no assurance can be given that the closing conditions will be
satisfied.
Louis D. Paolino, Jr., CEO and Chairman of Mace, said, "This is a defining
moment for the entire car wash industry. Mace will be the largest car wash
chain that has ever been assembled in the United States. The combination of
the two companies' operational management teams, coupled with the critical
mass of operating and marketing 134 car washes in 18 states, enables us to
utilize diverse economies of scale to increase profit margins, while
continuing to enhance the operating efficiencies that have already begun to
develop at Mace."
Mr. Paolino added, "I am extremely pleased with the appointment of David
Smith as our President and Chief Operating Officer. Mr. Smith is highly
regarded in the car wash industry as a successful operator and manager of
numerous wash locations, as well as in the financial community for his prior
performance as a senior executive of several public companies. Mr. Smith,
along with Michael Fazio, who will continue as Vice President of Operations,
will lead Mace's new operational structure by immediately implementing
consistent internal control systems to integrate both companies, as well as
executing the roll-out of our future brand name image to all of our car wash
locations."
David T. Smith, Chief Executive Officer of Wash Depot, said, "I look
forward to working with Mr. Paolino and Mace's entire management team. What
Mace has accomplished in the past 10 months has been very essential for the
future development of the car wash business. Mr. Paolino and Mace management
have established significant operating standards and fundamentals that will be
emulated by all future public companies focusing on the car wash and car care
service industries." Mr. Smith also said, "Combined, Mace and Wash Depot will
emerge as a performance-based business consisting of a modernized and
customer-oriented image with strong internal control systems, highly-
experienced management and internal growth that will ultimately revolutionize
the entire car wash industry."
Mace's corporate headquarters will stay in Mount Laurel, New Jersey. At
the completion of the transaction, Mace will be operating car washes in 18
states including Arizona, California, Connecticut, Delaware, Florida, Georgia,
Illinois, Indiana, Iowa, Massachusetts, Michigan, Minnesota, Missouri, New
Hampshire, New Jersey, Pennsylvania, Tennessee and Texas.
Wash Depot Holdings, Inc., located in Saugus, Massachusetts, was founded
in 1995 by its current Chief Executive Officer, David T. Smith, and current
Executive Vice President, Andrew Smith. Wash Depot is a full service and
exterior only car wash operating company consisting of 73 car washes in 15
states. Of Wash Depot's 73 car wash locations, all contain professional
detailing services, 72 contain convenient stores or similar related retail
product shops, 15 contain oil and lubrication centers and eight contain
gasoline dispensing services.
Mace Security International, Inc. is a provider of car care services,
which owns and operates numerous car washes nationwide. The Company, through
its wholly owned subsidiary, Innovative Control Systems, Inc., is also a
leading manufacturer and supplier of a Windows(R)-based computerized car wash
tunnel control system. Additionally, MSI is a leading producer of less lethal
defense sprays for the consumer market.
This press release includes statements which may constitute forward-
looking statements made pursuant to the safe harbor provision of the Private
Securities Litigation Reform Act of 1995. This information may involve risks
and uncertainties, including but not limitation, risks relating to the
financial outcomes of the planned business and growth strategies, that could
cause actual results to differ materially from the forward-looking statements.
Although the Company believes that the expectations reflected in such forward-
looking statements are based on reasonable assumptions, such statements are
subject to risks and uncertainties that could cause actual results to differ
materially from those projected.