Vertu Motors plc, the automotive retailer across the UK, is pleased to announce the acquisition of the trade and assets of three franchises on a multi-franchise dealership in Edinburgh, Scotland from the administrators of Leven Cars Group Limited.
Vertu expects the acquisition to contribute a small loss in the first full year of ownership, the year ending 28 February 2021, and to be earnings enhancing thereafter.
The purchase of this Kia, Suzuki and Mitsubishi leasehold dealership in Edinburgh represents further expansion of the Group’s Macklin Motors brand in Scotland and complements the Group’s existing nine outlets in Scotland comprising the Nissan, Ford, Mazda, Peugeot and Hyundai brands. The acquisition brings Kia, Suzuki and Mitsubishi as new franchises to the Group operations and these franchises are expected to provide further growth opportunities going forward. Marketing and operational synergies are anticipated to arise as a result of adding additional scale to the business in Scotland.
The combined management accounts of the outlets acquired indicate that they achieved pre-acquisition revenues of approximately £27m and incurred a significant trading loss. Manufacturer support has been obtained for the transaction and a short-term lease entered into on the current premises. It is planned to build a new multi-franchise dealership on land already purchased by the Group in Edinburgh within the next two years.
Robert Forrester, CEO of Vertu said: “We are delighted to announce further expansion of the business in Edinburgh following from the acquisition announced last week in Yorkshire. This acquisition out of administration represents value, and brings the Kia, Suzuki and Mitsubishi franchises with growth prospects to the Group. The addition of these outlets augments the Group’s representation in Scotland under the Macklin Motors brand and expands our operational footprint in Scotland. In the process, we have also secured over 50 jobs which were under threat.
The deal goes to the heart of the Group’s strategy to continue to grow a significantly scaled franchised dealership Group and to allocate capital in order to generate increased cashflows and returns for shareholders in the medium term.”