Most of Service King’s 31 shops and 1,000 employees are in the Dallas area. The privately held company, which says it has a 20 percent market share in the area, expects to repair about 70,000 vehicles and earn $150 million in revenue this year. Service King is working with wealth management firm BB&T, based in Winston-Salem, NC, to help find the appropriate investment partner.
Kirk said Service King’s goal of partnering with an investment firm is to help the company establish additional shop locations throughout the U.S.—beyond the 47 facilities it already operates in Texas.
“We are not being sold or bought-out,” Kirk said. “Our goal is to become a national organization. We just want to grow beyond Texas, and become the largest and best-run collision center in the United States.”
Service King has not yet decided much about the new locations, or how much capital it needs to acquire, or even which areas of the country it target, Kirk said. Those decisions will be made in conjunction with the eventual investment partner.
Cathy Bonner, a Dallas native, is Lennox’s sister-in-law. She has started and managed three marketing and communications firms. She will take point on developing a strategic plan for growth, determining which markets Service King should enter and overseeing that plan.
“Eddie approached me and convinced me I don”t need to know how to fix a car,” said Bonner, 60, a finalist in 2007 for The Dallas Morning News” “Texan of the Year” award for her work to pass legislation creating the Cancer Prevention and Research Institute of Texas. “I just get to build on their success.”
Bonner said she intends to have a growth strategy plan completed by the first of the year.
“I had a lot of experience identifying new markets and bringing in corporations when I was with the state,” said Bonner, who was part of a team of officials in the early 1990s that helped convince General Motors Corp. to not close its assembly plant in Arlington.
“This relates to growth and getting someone who can help us achieve it—and not ex-technicians like myself,” Lennox said.
Kirk said the growth initiative would not cause any changes to Service King’s business structure. Lennox intends to remain involved with the company, and no employee layoffs are expected, she said.
Bonner, does not get stock in Service King, says she doesn”t view her job as a long-term position. Lennox’s 34-year-old son, Jeremy, will assist her.
“I”m not going to dilute the stock,” she said. “I see my role as being short in terms of achieving the goals we want to attain.”
Despite its moves to get larger, Service King has no interest in going public, said Lennox, who holds 80 percent of Service King’s stock along with his wife. Managers throughout the company own the remaining 20 percent.
“We”re well capitalized, and we have good banking relationships,” he said. “We envision doubling our revenue in three to five years.”
“This is strictly a growth strategy, and the result of a growth plan we”ve identified for 2012. The timing is right,” Kirk said. “It’s all good for the employees at Service King. It allows for more opportunity for everybody within the company to grow with us in the future.”