GROWING A CLASSIC BUSINESS
Legendary Companies acquire Paragon restorer of classic Corvettes
Since the late Harold Coker opened a tire store in Athens, Tennessee, in 1958, the Coker Tire Co. grew from a traditional tire retailer into the world’s largest manufacturer and supplier of collector vehicle and motorcycle tires.
Under the ownership of the New York equity firm Irving Place Capital for the past three years, Coker Tire is continuing to evolve and expand in the classic car equipment market.
The Chattanooga-based maker of classic wheels and tires, which now brands itself as Legendary Companies, completed its third acquisition in as many years this spring with the purchase of Paragon Corvette Reproductions. The Michiganbased Corvette restoration parts manufacturer and supplier offers restoration components for 1953 through 1996 Corvettes.
“This purchase marks a really important break for us in increasing the breadth of products we have,“said Wade Kawasaki, the CEO of Legendary Companies who helped lead the purchase of Coker Tire company from its founding family in 2018.
Kawasaki said he expects to increase the company’s Chattanooga sales, administrative and call center staff over the next three to five years to help handle the increase in business for Paragon and other classic car equipment makers the company is looking to buy. Kawasaki said Paragon “has an amazing track record for supplying the best restoration components for classic Corvettes” and he said the founders of Paragon, Steve and Stacey Childs, “are second to none’ in their knowledge on classic Corvettes.
Paragon handles more than 36,000 parts for a 43-year range of Corvettes.
True to its name, Legendary is eager to buy other companies like Paragon regarded as legendary companies in the industry.
“We’re really looking to aggressively acquire more companies,” Kawasaki said. “With Irving Capital, we have access to a huge team to do our due diligence on any acquisitions we are considering and it has also helped us operationally in seeking out the best talent. So we have been able to both promote from within but also add some great new talent.”
In the past, Coker Tire has bought wheel and tire-related companies that strengthen its classic tire or wheel production or distribution business around the globe. The Paragon purchase, and similar other acquisitions the company is pursuing, will build upon the company’s existing sales network and product offerings.
“Our existing customers — and new customers drawn to us by Paragon — will be buying restoration parts from us and not just tires,” Kawasaki said. “When you are restoring a Corvette, yes you are buying Coker tires and wheels, but you also may need weather stripping, bumpers, exhaust systems and all the things that Paragon sells. We look for acquisitions where one plus one equals three and the Paragon purchase is a perfect example of that.”
Paragon, like other Legendary Companies, makes most of its products in the United States and will continue to operate from Michigan. The company was started in the 1970s by Steve and Stacey Childs near Flint, Michigan, where the classic Chevy Corvettes were originally assembled..
“When the time came to sell Paragon, we knew we wanted a partner that understood our market and believed in our potential,” said Steve Childs, president of Paragon Corvette Reproductions. “After interviewing many investors, it was clear that Wade and the partners at Irving Place Capital were the perfect fit for us. There are a lot of competencies that we have to come alongside them to start increasing their sales and take some of the administration off of their plate. We can use our economies of scale to help them get better deals and take some of the administration functions off of their leadership’s plate so they can focus on what they do most effectively.”
The purchase of Paragon is the fifth company acquisition negotiated by Kawasaki since he became CEO of Coker Tire in 2014 after the retirement of Corky Coker in 2014. Like the Corkers who have collected classic cars and still own Honest Charley Speed Shop in Chattanooga, Kawasaki has been a lifelong fan of classic cars.
Kawasaki grew up working at his father’s gas station in Los Angeles during the muscle car era. He later worked at a speed shop and with his wife, Rose, launched Exports International in 1987. Kawasaki met Corky Coker through SEMA (Specialty Equipment Market Association), the trade association for aftermarket product producers, and soon joined Coker Tire Co.
The Legendary Cos. CEO now oversees 14 brands and six operating companies, which include Coker Tire, Universal Vintage Tire Co, Phoenix Race Tires, Wheel Vintiques, Roadster Wire Wheels, MORMünchner Oldtimer Reifen and The Great Race. Legendary Companies has distribution in more than 60 countries.
Kawasaki said sales and inquiries to the company’s call center initially dropped dramatically last year when the COVID-19 pandemic first shut down much of the economy. But by mid-April 2020, sales and web traffic quickly returned “and it’s been a non-stop increase ever since,” Kawasaki said.
“People were not traveling as much or going out to eat last year, but you could still walk out to your garage, work on your classic car or take it for a drive,” he said. “All of those projects people had been putting off for years, they were firing up again.”
Sales remain strong in 2021 even as the economy begins to open up. Kawasaki said bookings are up 30% so far in 2021 to an all-time high for the company and the biggest challenge now is to overcome supply chain interruptions and a tight labor market to meet the increased demand.