Vertu Motors PLC Acquisition of Vans Direct Limited (3027M)
07 January 2019 - 6:00PM
UK Regulatory
TIDMVTU
RNS Number : 3027M
Vertu Motors PLC
07 January 2019
7 January 2019
Vertu Motors plc ("Vertu" or the "Group")
Acquisition of Vans Direct Limited, the award winning
independent online retailer of new vans
Vertu, the automotive retailer with a network of 125 sales and
aftersales outlets across the UK, announces that it has acquired
the entire share capital of Vans Direct Ltd ("Vans Direct") which
is a well-established on-line retailer of new vans
(www.vansdirect.co.uk) based in Newport, South Wales for an
estimated total consideration of GBP7.5m.
Acquisition Highlights:
-- Well established independent on-line light commercial vehicle broker business.
-- Business brings significant know-how and accelerates the
Group's presence in multi-channel retailing through its high
ranking website domain.
-- Synergy opportunities with existing Vertu light commercial vehicle businesses.
-- Immediately earnings enhancing.
The Vans Direct business has built a successful on-line, van
retailing business, putting customers first and winning the 'Best
Van Leasing Broker' award from the Leasing Broker Federation for
the last three years (2016, 2017 and 2018).
The Vans Direct business was founded in 1999, but flourished
following the appointments of Jane Pocock as Managing Director and
Richard Simmonds, as Operations Director, of the business in 2009.
Richard Simmonds will be joining the Group along with their team of
42 colleagues and Jane Pocock will remain a non-executive director
of Vans Direct following the acquisition.
Total consideration is estimated at GBP7.5m, this includes an
estimated amount in respect of an earn-out arrangement rewarding an
on target performance over a two year period. The terms of this
earn out may result in additional consideration, up to an amount of
GBP2m, being paid in the event that future profit targets are
exceeded. This consideration includes an initial payment for
goodwill of GBP6m together with estimated net assets of GBP1m
(including cash of GBP0.6m). The initial payment of GBP7.0m has
been settled in cash from the Group's existing resources.
For the year ended 31 October 2017, Vans Direct reported
revenues of GBP34.6m, a gross margin of 11.7% and EBITDA of
GBP1.2m. The Board expects this acquisition to be immediately
earnings enhancing.
Robert Forrester, CEO of Vertu Motors said:
"This is an exciting development in a growing space, which is
synergistic and parallel to our core motor retail business and
which strengthens our multi-channel offering. We expect Vans Direct
to generate an earnings stream with higher gross and net margins
than those typically earned by the Group, and we believe that the
future growth prospects for this new business are significant. By
working with the complementary skills of the Vans Direct team and
the Group's existing operations, we believe that we can build a
significant business which will meet the needs of a wider range of
customers."
- Ends -
For further information please contact:
Vertu Motors plc
Robert Forrester, CEO Tel: 0191 491 2111
Michael Sherwin, CFO Tel: 0191 491 2112
Zeus Capital Limited
Nicholas How Tel: 020 3829 5000
Andrew Jones
Dominic King
Camarco
Billy Clegg Tel: 020 3757 4983
Tom Huddart
Notes to Editors
Vertu Motors is the sixth largest automotive retailer in the UK
with a network of 125 sales outlets across the UK. Its dealerships
operate predominantly under the Bristol Street Motors, Vertu,
Farnell and Macklin Motors brand names.
Vertu Motors was established in November 2006 with the strategy
to consolidate the UK motor retail sector. It is intended that the
Group will continue to acquire motor retail operations to grow a
scaled dealership group. The Group's acquisition strategy is
supplemented by a focused organic growth strategy to drive
operational efficiencies through its national dealership network.
The Group currently operates 122 franchised sales outlets and 3
non-franchised sales operations from 106 locations across the
UK.
Vertu's Mission Statement is to "deliver an outstanding customer
motoring experience through honesty and trust".
Vertu Motors Group websites - www.vertumotors.com /
www.vertucareers.com
Vertu brand websites - www.bristolstreet.co.uk /
www.vertuhonda.com / www.vertutoyota.com / www.macklinmotors.co.uk
/ www.farnelllandrover.com / www.farnelljaguar.com /
www.vertuvolkswagen.com / www.vertumercedes-benz.com /
www.hughes-group.net
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END
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