Lookers has acquired 10 sites from HR Owen in a move that will see the dealer group now represent the Mercedes-Benz franchise.
The consideration payable in cash will be £5m goodwill and £8.1m of fixed assets. Once the value of stock is taken into consideration, however, the value of the deal could rise to between £18m-£25m.
The acquisition is expected to add around £175m to Lookers’ annual turnover and enhance profits in the first full year of ownership.
It represents the Manchester-based dealer group’s first purchase since the drawn-out battle with rival Pendragon for Reg Vardy at the beginning of the year.
Lookers’ chief executive Ken Surgenor told Motor Trader the deal was representative of the group’s strategy to expand its range of premium brands.
So far this year Lookers has boosted the number of Land Rover sites it operates by three as well as adding two Volvo and Jaguar dealerships in a multi-million pound deal with HR Owen at the start of the year.
“Our stated strategy has been to strengthen the mix of premium brands that Lookers operates. The market is going the way of the premium brands. You can see both BMW and Mercedes strengthening their market share and our strategy is in response to those market trends,” he said.
Surgenor said that the group had been keen to add Mercedes-Benz to its portfolio and did not rule out adding to the newly acquired franchise but said that was dependent on the manufacturer and the sites that became available in the future.
“We’re delighted to be approved by Mercedes. It’s a brand we’ve wanted to represent for some time,” Surgenor added. The deal covers four Mercedes sites in Redhill, Gatwick, Eastbourne and Brighton, with the latter also selling Smart; two ChryslerJeep outlets in Hatfield and Romford; two Lexus sites in Hatfield and Brighton; and Land Rover sites in Acton and South Kensington.
Lookers is a car dealership chain in the United Kingdom with over 90 dealerships turning over in excess of £1bn annually. |
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