Actually, it is a second chance. The group used to be a part of Perrys, which was listed on the main market. For a while, in the middle and late Nineties, the Perry story was all about whether or not the dealer group could escape its poor performance as a car dealer and get into a rich profit seam with these very same body repair shops.
Many believed in the story – and lost money. Perrys found that it was supping with the devil. No sooner had it celebrated winning the contract from another insurance company for processing all its damaged cars nationwide, than the insurer locked horns and demanded a special rate in exchange for the guaranteed volume.
The nasty experience ran in tandem with stiffening environmental processes and the expensive re-equipping of the acquired bodyshops.
With the new player comes a different tune. The retail and bodyshop businesses split in 2001 after an MBO of the dealer group by Ken Savage and Paul Millard. It continues to trade successfully as Perrys Group. Meanwhile, in the last four years, Nationwide has grown to 69 repair shops and is generating an operating margin of 2.8% on £140m turnover – by far the largest bodyshop chain in the UK.
Venture capitalist owners Guinness Peat and JO Hambro are planning to sell a third of their holding on AIM – valuing the business at £50m.
Chief executive Michael Wilmshurst, ex of HR Owen and European Motor Holdings, is handed the credit for the change of fortune in repair shop consolidation.
He has assembled a cracking board of directors for his public company float: Stephen Thompson has been with Kwik-Fit, Michael Marx has been the chief financial officer of Heron, and Lady Barbara Judge is deputy chairman of Friends Provident.
She should know a thing or two about insurers who might need their customers’ cars mended at Nationwide.