7:44 am, December 8, 2022
Vertu Motors has agreed to acquire the lion’s share of family-run dealer group Helston Garages.
The deal, which is subject to FCA regulatory approval, is worth circa £185m.
The listed dealer group will take on 28 of Helston’s dealerships, and the deal is expected to be approved by the FCA within the next five weeks with the business’s full integration expected by the end of March 2023.
Brands Ferrari and Volvo will join Vertu’s portfolio, and takes Vertu’s representation up to 188 franchised sites.
All dealerships will be rebranded as Vertu Motors and Bristol Street Motors, apart from the sole Ferrari operation.
Vertu’s acquisition of Helston’s business and 28 dealerships will be minus 12 sites which were recently sold to south coast firm Yeomans. Helston’s Porsche business in Exeter was also snapped up by Rybrook earlier this month.
The acquisition rubber-stamps Vertu’s announcement last month of it being ‘in advanced discussions’ to buy the family-owned concern, and bolsters the listed dealer group’s plans to grab a larger share of the motor retail pie.
Making the announcement on the London Stock Exchange this morning, Vertu said the deal ‘is a continuation of the long-term strategy of the group to drive scale, expand into new and attractive regions and introduce new manufacturer partners’.
It added: ‘The transaction is expected to have a limited impact on the group’s underlying profit before tax for financial year to February 28, 2023 (FY23) due to the timing of the transaction in relation to Vertu’s financial year end.
‘One-time deal related costs of £2.5m are anticipated and will be included in non-underlying costs for FY23.’
Vertu Motors CEO Robert Forrester (pictured top) said: ‘We are delighted that Vertu Motors has agreed to acquire Helston and 28 dealerships, further evidence of the execution of our long-term strategy to build scale, geographic coverage and deepen our relationships with our key automotive manufacturers.
‘We are particularly pleased that we have received strong support for the acquisition from our manufacturer partners and our lending banks to support the deal.
‘Volvo and Ferrari are introduced to our portfolio, which is a very proud moment for the group.
‘Helston has a long track record of delivering strong profitability and we have admired the group for a long time.
‘The acquisition will be both financially and strategically accretive for Vertu Motors, delivering long term value creation for our shareholders. We now have 32 dealerships in the south west, which becomes a core region.
‘I am delighted to welcome so many new colleagues to the group and look forward to integrating Helston and the team into Vertu Motors, particularly introducing our digital expertise.’
Forrester added: ‘While there is uncertainty in the UK economy today, we continue to invest for the long-term and remain excited about the future for Vertu Motors.’
David Kendrick of UHY Hacker Young, which advised on the deal, said: ‘Having worked on this deal for over nine months, advising the Helston shareholders it’s a relief to get this concluded.
‘A fantastic business that has been sold to three different parties with Vertu finally taking the large remaining element. Circa £185m including cash so our biggest deal to date. A big thank you to the UHY automotive team on this deal and congratulations to the Helson shareholders and Vertu.’
Kendrick recently appeared on the Car Dealer Podcast to discuss current mergers, including the Helston deals – you can listen to it here.
Analysts Zeus Capital said the acquisition will enhance its FY24 and FY25 forecasts for Vertu by 18.7 and 24.7 per cent respectively.
Helston Garages has been trading since 1960 and was founded by David Stanley Carr and Betty Vera Carr in the Cornish village of the same name.
The husband and wife team have both died and it is believed the beneficiaries of the business did not want to run the business, which triggered the sale.
The family-owned company operates its showrooms under a handful of names including Carrs, Yeovil Motor Company, Truro Motor Company, Truscotts and Kastner. It has over 40 sites.
Helston Garages was the 17th most profitable dealer group in the Car Dealer Top 100 in 2021.
It its latest accounts, 2021 return on sales increased by an incredible 4.9 per cent, while turnover rose from £511m in 2020 to £626m. EBITDA profit came to £33.9m.
