One of Scotland’s most successful entrepreneurs has sold his tyre-fitting business for £50m to Michelin.
Mike Welch, chief executive of Blackcircles.com, can expect to gain a third of that sale price, while staying with the company.
He started selling tyres aged 16 before joining Kwik-Fit.
Aged 21, he set up Black Circles, basing it in Peebles, where it employs 50 people.
Welch, now aged 36, built it up to annual sales in 2013 of £28m, with annual growth of around 20% per year since 2008. The first three months of this year have seen revenue rise by 34% on the same period last year.
The company developed a ‘click and fit’ business model. Customers choose their tyres online, they are then delivered directly from manufacturers to one of 1,350 independent garages, where the customer then books in a tyre-fitting session.
According to the chief executive, prices undercut conventional sales by 20%-to-40%.
In March, the company announced that it was looking at ways to extend its growth, including a float on a stock exchange, private equity investment, or a sale.
It recruited former Tesco boss Sir Terry Leahy onto the board, to use his expertise in retail. There is also a trial of a Blackcircles fitting service at some Tesco superstores, reported the BBC.
The Michelin deal opens up expertise and a much wider distribution network, without limiting Blackcircles.com to the parent company’s brand products.