Advance Auto Parts said Monday it has acquired the DieHard brand of auto batteries from the company that owns the assets of Sears and Kmart.
The $200 million sale will give Transform Holdco, controlled by hedge fund operator Eddie Lampert, cash it needs as it continues to cull stores, sell the real estate and try to salvage what it can of the once-dominant American retailer.
The deal will bring DieHard batteries into Advance’s stores, although they will remain in Sears and Kmart locations as well. The companies said Advance can apply the DieHard name to other automotive products, while Transform Holdco can develop and market non-automotive products using the brand.
Advance CEO Tom Greco said the acquisition will help distinguish his chain from competitors. Aside from more than 5,000 of its own locations, Advance serves more than 1,200 independently owned Carquest outlets.
“DieHard stands for durability and reliability, and we will strengthen and leverage the brand in other battery categories, such as marine and recreational vehicles,” Greco said. “We also see opportunities to extend DieHard in other automotive categories.”
Greco told CNBC a deal Sears had struck to sell DieHard products on Amazon will not be continued. Instead, he said Advance will look at bringing the products to its own retail partners such as Walmart.
Peter Boutros, president of Transform Holdco’s Kenmore, Craftsman and DieHard business unit, said, “DieHard revolutionized the automotive battery category when it launched in 1967 and has continued to be a leader in the category. Advance Auto Parts’ acquisition of this iconic American brand will complement our plans to introduce new DieHard products in non-automotive categories such as sporting goods, lawn and garden, authentic work wear and other exciting new categories.”
In February, Lampert’s company committed $5.2 billion to acquire the Sears and Kmart assets out of Chapter 11 bankruptcy when suppliers pressed for liquidation. At the time, there were more than 700 stores. By early 2020, that total will be down to 182. Lampert has cut staff at the Hoffman Estates headquarters, including a round of up to 300 layoffs in November affecting that site and others.
