Zep to Create New Business After Acquiring Ecolab Vehicle Care - Modern Distribution Management

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Zep to Create New Business After Acquiring Ecolab Vehicle Care

The new business platform will represent 13% of manufacturer's sales.
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Atlanta-based Zep Inc. (NYSE:ZEP), a producer of cleaning and maintenance solutions, has agreed to buy Ecolab Vehicle Care, a division of Ecolab Inc. (NYSE: ECL), for $120 million.

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Sales for Ecolab’s vehicle care division for the trailing 12 months ending June 30, 2012 were $66 million.

Once approved, the combination of Ecolab’s Vehicle Care division, Zep’s existing North American Sales and Service vehicle wash operations, Niagara and Washtronics will create a new platform, Zep Vehicle Care, representing 13 percent of the manufacturer’s sales. Zep Vehicle Care – to be based in Minnesota – will be a provider of vehicle care products, including soaps, polishes, sealants, wheel and tire treatments and air fresheners to professional car washes, convenience stores, auto detailers and commercial fleet wash customers.

Zep Vehicle Care will access customers through the direct and distribution channels, and will provide car, truck and fleet wash operators high efficacy products for their wash tunnels and facilities as well as retail operations.

“This transaction creates a dynamic and compelling sales and marketing platform for the $1 billion U.S. vehicle care marketplace,” said John K. Morgan, president and CEO of Zep. “… By combining outstanding vehicle care brands, products and professionals, the formation of Zep Vehicle Care represents another example of our diversification strategy and our disciplined focus within those key markets where we bring unique value and expertise to our customers.”

The products and services offered by Zep Vehicle Care will combine brands such as Zep Enviroedge, Niagara National, Washtronics and Armor All Professional with Blue Coral, Rain-X and Black Magic.

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