Cambria Automobiles could be taken private in a management buyout deal announced today to the Stock Market.
The current board – led by chief executive Mark Lavery and his colleagues finance director James Mullins and Tin Duckers – are exploring an acquisition at 80 pence per share.
The business, which has a current market cap of £66m, was trading on Friday at 66p per share.
A statement from Cambria said: ‘There can be no certainty that an offer will be made.
‘A further announcement will be made when appropriate.’
Cambria operates under the Doves, Grange and Motorparks brands and represents a large portfolio of manufacturers including Rolls Royce, McLaren, Aston Martin, Bentley and Jaguar Land Rover.
Chief executive Mark Lavery told Car Dealer this morning he could not comment at this stage of the process.
City insiders said the deal could have been triggered by the team after concerns the dealership group simply hasn’t been rewarded for its performance on the Stock Market. It came to the market with profits of around £3-4m a year and has trebled that, but its share price hasn’t followed.
Cambria Automobiles was the 14th most profitable dealer in the Car Dealer Top 100 list, released last year. It made EBITDA profits of £17m.
Mike Jones, compiler of the list and the executive chairman of ASE Global, said: ‘Ever since it floated, to enable the exit of the company’s private equity backer Promethean, Cambria has been a thinly traded stock with little liquidity.
‘This reduces the benefits to the company of being listed and the management team have clearly come to the conclusion that the business would be better returning to private ownership.
‘Given the stock already held by the management team, the 80 pence per share exploration, at a 21 per cent premium over Friday’s close price, looks highly likely to be successful.’
Cambria was formed in 2006 with a strategy to ‘build a balanced motor group’ through partnerships with manufacturers, ‘self funded’ acquisitions and turning around poor performing businesses.
On its website, the group says: ‘This strategy has proved very successful.
‘Our success in turning around under-performing dealerships has enabled Cambria Automobiles to build a strong balance sheet.
As a result, the Group is now in a position to consider acquisitions which are earnings enhancing from the outset, strengthening Cambria’s brand portfolio mix further and fulfilling our national ambitions to create five regional clusters, each with a turnover of £200m.’
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