Golden Gate recaps Tidal Wave Auto Spa in $950m deal

The San Francisco PE firm plans to accelerate growth at the car wash chain via organic efforts at existing sites, aggressive new unit expansion and an enhanced acquisition program.

Golden Gate Capital’s recapitalization of Tidal Wave Auto Spa, a rapidly growing car-wash chain, commanded an enterprise value of approximately $950 million, a source familiar with the matter told PE Hub

The transaction was announced Wednesday, December 30, before the new year. Tidal Wave Founder and CEO Scott Blackstock will continue to lead the company out of Thomaston, Georgia, remaining a significant shareholder, the news release said. 

Founded in 1999, Tidal Wave runs conveyor car wash systems. Its unit count has grown 50 percent annually since 2017, pushing its footprint north of 60 locations across 11 states in the southeast and midwest. 

Tidal Wave differentiates through its Unlimited Wash Club, which offers customers value across an array of options, including exterior and interior cleaning, as well as a family plan.

Ropes & Gray and Nob Hill Law Group worked as legal advisers to Golden Gate Capital. Troutman Pepper Hamilton Sanders was legal adviser and J.P. Morgan Securities worked as financial adviser to Tidal Wave.

Blackstock said in the announcement that “Golden Gate Capital will provide invaluable multi-unit consumer and real estate industry expertise and additional development resources, which will fuel our continued expansion across the United States.”

Neale Attenborough, operating partner at Golden Gate, spoke to the firm’s plans to accelerate Tidal Wave’s “trajectory through organic growth at existing sites, aggressive new unit expansion and an enhanced acquisition program.”

San Francisco’s Golden Gate has long experience of investment in the multi-unit consumer industry.

In relevant activity, the firm acquired Express Oil Change & Tire Engineers in 2017, which combined with Mavis Discount Tire in 2018 to create one of the largest automotive service platforms in the US. In connection with the merger of the two businesses, Golden Gate acquired a stake in Mavis from ONCAP, Onex Corp‘s middle-market private equity platform.

Other notable recent multi-unit investments include Golden Gate’s 2018 acquisition of The Learning Experience, a national franchise and academy of early education, and its 2019 deal for Invo Healthcare, a provider of autism and childhood behavioral health services. 

A Golden Gate representative declined to comment. 

Update: This report has been updated to clarify the timeline of the Express Oil and Mavis transactions.