Publications that covered this story include: AM Online, Motor Trader, Car Dealer Magazine, Business Desk, NW Insider and Pro-Manchester Newsroom on 15 August 2016.
David Kendrick and Paul Daly, automotive partners, advised the shareholders of Warwick Holdings Limited t/a Drayton Group on the disposal of their business to Lookers plc, one of the leading UK motor retail and aftersales service groups, for £55.4m in cash.
The acquisition is being funded from existing bank facilities through a conditional contract, with the condition being the successful conclusion of the sale of the Parts Division, which is expected to complete by the end of October.
Drayton Motor is a highly successful business with a reputation for providing outstanding customer service. Founded originally in 1922, Drayton Motor has evolved into a luxury car retailer offering sales, parts, service and repair facilities for new and used cars and is a four-time winner of Mercedes-Benz Retailer of the Year. The company operates from seven locations in Stoke on Trent, Stafford, Shrewsbury, Wolverhampton, Walsall, Stourbridge and Worcester.
The acquisition will increase Lookers partnership with Mercedes Benz and Smart and will further bolster the Group’s offering to customers in the Midlands.
The statutory accounts for Drayton Motor for the year ended 31 December 2015 reported turnover of £276m and profit before tax of £5.2m. The Company had gross assets of £84.2m and net assets of £22.0m.
The Mercedes Smart Division combined with Lookers’ Mercedes outfits will have turnover in excess of £600m in a full year.
This acquisition is expected to be earnings enhancing for the year ending 31 December 2017.
David Kendrick, head of our national automotive group, said:
“The Drayton Mercedes-Benz business is regarded as one of the premier prestige groups in the UK. Having known the shareholders for some time it was fantastic to deliver a deal for them that gave them a clean exit and also an acquirer in Lookers that has very similar values and culture. The Lookers team will no doubt develop the business further in the future and this purchase takes their number of Mercedes market areas to two.
The demand for premium brand businesses certainly continues to increase and we have no doubt there will be further consolidation and perhaps some new international entrants into the UK market over the coming months.”