7:24 am, March 14, 2023
Cambria Automobiles boss Mark Lavery says he does not believe there will be any publicly listed dealer groups in the UK by the end of the year.
In a wide ranging interview at last week’s Car Dealer Live conference he backed the likes of Vertu, Lookers and Pendragon to follow his firm into private ownership.
Lavery told interviewer James Baggott that profitable UK dealer groups represented ‘extraordinary value’ to investors.
He also said outfits currently floated on the London Stock Exchange were trading at massive discounts when compared with their net assets.
‘I am on record as saying I don’t think there will be any public companies by the end of December this year,’ he said.
‘I think there are some exceptional businesses – Lookers, Vertu and Pendragon are all trading at a massive discount to net assets.
‘That’s frankly the position we [at Cambria Automobiles] found ourselves in.
‘When you look what’s happened to the value of sterling post-Brexit and what’s happened to the value of dollar post-interest rates going up, we represent extraordinary value to external investors.
‘Would I speculate on each of the three [Lookers, Vertu or Pendragon]? No, that would be unfair because I don’t have enough knowledge, but I do think that none of them will be in the public domain by the end of December this year.’
The Car Dealer Live audience was also asked which of the three main listed car dealer groups they thought would be snapped up first.
Some 38 per cent said they thought Vertu Motors would be next, followed by Pendragon with 33 per cent and Lookers with 29 per cent.
Lavery’s comments formed part of our detailed interview with the industry leader, who also gave his opinion on agency sales.
If you’d like to watch back the session on video, and the rest of the day’s interviews, you can do so with a Watch Online ticket that will allow you to replay the whole event.
Lavery was the first speaker of a jam-packed day and told those present at the British Motor Museum in Gaydon that the investment community ‘does not understand automotive retail’.
It comes after he led a management buyout of Cambria for £82.5m.
Speaking at last week’s conference, sponsored by Auto Trader, he said: ‘The investment community in the UK doesn’t really understand automotive retail.
‘I think there’s an argument to suggest that the investment community globally doesn’t understand automotive full stop.’
When asked what the advantages of going private had been, Lavery declared: ‘Freedom.
‘We have taken back control. We don’t have to spend the amount of time on shareholder relations, which those people in the room who have worked for public companies will understand. The quantums are just extraordinary.
‘In our case, there were a lot of very small funds. A lot of those people took a lot more of our time.
‘I think we’re in a better place, we’re excited about the future and we believe we’re a lot more happy as a business now than when we were public.’
Car Dealer Live will be back in 2024 on March 7. Ticket sales will go on sale shortly for those who weren’t at the event.
