REG - Vertu Motors PLC - Further Acquisition in the South West

Vertu MotorsAnnouncement

01/11/2023 07:15

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RNS Number : 9495R  Vertu Motors PLC  01 November 2023

1 November 2023

Vertu Motors plc ("Vertu Motors" or "Company")

Further Acquisition in the South West

Vertu further expands its footprint in the South West of England with the
acquisition of Rowes Garage Limited

Vertu Motors, the UK Automotive retailer with a network of 193 sales and
aftersales outlets across the UK and a sector leading online presence, is
pleased to announce that on 31 October 2023 it has acquired the entire issued
share capital of Rowes Garage Limited ("Rowes").

·      Successful bolt-on acquisition of 4 sales outlets in South West
of England, further strengthening Vertu Motors position in the region

·      Expansion of relationship with Honda, now 17 outlets in the UK

·      Acquisition funded by existing cash resources, reflecting ongoing
execution of group strategy

·      Acquisition to be EPS accretive in first full year of ownership,
with strong asset backing of acquired business

·      Small trading loss expected from acquisition, due to seasonality,
in financial year to Feb 2024

Rowes has been trading for over 90 years, growing to become one of the most
successful Honda dealer businesses in the UK.  The outlets operated by Rowes
represent the Honda franchise, and are located in Plymouth, Plymstock and
Truro. The business also operates a Suzuki franchised outlet in Plymouth,
which will continue to operate as a used car outlet and Suzuki authorised
repairer on acquisition and will be refranchised in due course.  The business
will be rebranded to trade under the Vertu and Bristol Street Motors brands
immediately augmenting the Group's representation in the South West. Following
the successfully integrated Helston acquisition in December 2022, the Group
operated 30 sales outlets in the South West and this latest acquisition,
results in 34 outlets now being operated in the region representing
considerable scale. This is the first time the Group has operated in the major
Devon city of Plymouth. In addition, further scale is added to the
relationship the Group has with Honda and will now operate 17 outlets for the
brand. The Group was already Honda's largest retail partner in the UK.

For the year ended 31 December 2022, Rowes Garage Limited achieved revenue of
£30.2m and an operating profit of £745,000. Consideration, net of cash
acquired, is estimated at £6.2m, subject to finalisation of completion
accounts. The consideration includes freehold properties with a value of
£3.6m and a payment in respect of goodwill of £0.9m. This consideration will
be paid from the Group's existing cash resources. Due to the seasonality of
vehicle sales, the Business is expected to contribute a loss for the remaining
four months of the financial year to 29 February 2024 and is expected to be
earnings enhancing in its first full year of ownership.

Robert Forrester, CEO of Vertu Motors, commented:

"I am delighted to deliver further expansion for the Group in the South West
of England following the successful and accretive Helston acquisition. The
long standing successful Rowes business is a great addition to the Group's 14
existing Honda sales outlets and increases scale further in the South West
where we will operate 34 outlets.  We continue to execute our strategy to
build a scaled business."

 

 Vertu Motors plc                                     Tel: +44 (0) 191 491 2121
 Robert Forrester, CEO
 Karen Anderson, CFO
 Phil Clark, Investor Relations                       P.Clark@vertumotors.com

                                                      Tel: +44 (0) 203 829 5000

 Zeus (Nominated Adviser and Broker)
 Jamie Peel
 Andrew Jones
 Dominic King

 Camarco                                              Tel: +44 (0) 203 757 4983
 Billy Clegg
 Tom Huddart

 Notes to Editors
 Vertu Motors is the fourth largest automotive retailer in the UK with a
 network of 193 sales outlets across the UK. Its dealerships operate
 predominantly under the Bristol Street Motors, Vertu 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 188 franchised sales outlets and 5
 non-franchised sales operations from 144 locations across the UK.
 Vertu's Mission Statement is to "deliver an outstanding customer motoring
 experience through honesty and trust".
 Vertu Motors Group websites - https://investors.vertumotors.com
 (https://investors.vertumotors.com) / www.vertucareers.com
 (http://www.vertucareers.com)

Vertu brand websites - www.vertumotors.com (http://www.vertumotors.com) /
 www.bristolstreet.co.uk (http://www.bristolstreet.co.uk) / www.vertuhonda.com
 (http://www.vertuhonda.com) / www.vertutoyota.com (http://www.vertutoyota.com)
 / www.macklinmotors.co.uk (http://www.macklinmotors.co.uk) /
 www.vertumotorcyles.com (http://www.vertumotorcyles.com)

 

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