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Inchcape closes on £2bn mark with Lind

Inchcape Retail may adopt its Cooper brand name for the five Lind Automotive Group BMW/Mini dealerships it is buying as it has done with previous acquisitions.

Graeme Potts, Inchcape plc retail managing director for the UK, Europe and South America, says it is too early to confirm plans as the purchase will not be completed until next month.

His group is buying Lind in a deal costing £108.6m that makes it the UK’s largest retailer of the BMW/Mini brands with 13 showrooms. The Lind BMW/Mini centres are in Aylesford, Colchester, Chelmsford, Ipswich and Norwich.

Inchcape adds them to its existing network for the brands in affluent locations in the south east: Cobham, Long Ditton, Reading, Sevenoaks, South Croydon, Tadworth, Tunbridge Wells and Wimbledon. All use the Cooper name.

The purchase of Lind Automotive Group and its 21 outlets takes Inchcape Retail’s UK turnover close to £2bn. “The appeal of Lind lies in its mix of franchises and their locations, which fit perfectly with our own,” says Potts. “We also liked the quality of Lind’s retail premises.”

Inchcape is paying £71.4m for the equity, plus £24.5m for dealerships owned outside the automotive group and £12.7m for taking on debt. Potts says that Brian Fawcett, Lind’s managing director, will be part of Inchcape Retail’s management team.

Gaining Lind gives Inchcape additional outlets with two other franchises – four Volkswagen dealerships and one Land Rover. It marks a return to Audi (with four centres) and creates its first partnership with Honda (three outlets). “We want to expand with both of these manufacturers,” says Potts.

In calendar year 2005, Lind made an operating profit of £7.1m on a turnover of £395.6m. Andre Lacroix, Inchcape Group chief executive, says the group’s strong management would leverage Lind’s “performance improvement opportunities”.

Analysts have described the acquisition as “textbook” but Mitsubishi Motors is expected to terminate its franchise at Inchcape’s newly-acquired Colchester dealership.

Gabi Whitfield, Mitsubishi Motors spokeswoman, says: “Lind failed to inform us of its possible sale as it should have done and we heard about it from Inchcape. We do not grant franchises to plcs and to do so with Inchcape would mark a major policy decision which is highly unlikely.” Potts retorts: “It is our intention to get everything.”

Graham Dacre, the owner of Lind, who has banked £96m in the deal, kept his group’s Porsche centre in Tonbridge, Kent, out of the transaction because he says he enjoys driving the cars. Lind’s franchises and their locations have made the group a takeover target for some time and Dacre turned down several offers. Aged 54, he is thought to have wanted to keep the business longer but found Inchcape’s offer irresistible.

Dacre was a property investor in 1992 when he launched Lind with a £2,920 investment in Averills, a BMW outlet in Norwich, after persuading Barclays Bank to refinance the business. He hired high quality managers to develop a motor retail group and extended it into the south east.

Lind stands for Life In a New Dimension – like Potts, Dacre is a born-again Christian, and says part of his inspiration came from the late Rev Robert Lind Gordon. Dr Gordon was the first chairman of the Lind Group and a key figure in its early development.

Dacre retains property interests and has combined these with personal investments in charitable projects.

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