Last week Forrester’s AIM-listed company, Vertu Motors, announced a successful outcome several months after making an approach to BSG, the UK’s 13th largest franchise dealer. BSG’s chief executive Paul Williams becomes a director and non-executive chairman of Vertu Motors.
The move instantly puts Forrester at the head of a group turning over £576m from its 32 franchised sites and three Motor Nation used car supermarkets. Last year BSG achieved £5.1m operating profit. Forrester believes growth is possible through increased focus on used cars, fleet and contract hire, online retailing and centralized support services.
“Bristol Street has a very good selection of franchises, a good management team that delivers profit, and it’s a very stable business run by people I respect a lot,” says Forrester.
Forrester has already consulted with BSG’s franchises – Ford, Vauxhall, Citroën, Hyundai, Iveco, Peugeot and Renault – and says he expects these partnerships to continue. He hopes to increase representation with Vertu’s future acquisitions, which will be incorporated into the Bristol Street brand.
“Key to this deal is that we retain the Bristol Street brand, which is very strong and respected,” says Forrester.
Vertu Motors has offered £31m cash and £9m shares for BSG. Under reverse-takeover rules, trading in Vertu shares has been suspended pending reapplication of the enlarged group to AIM.
The company first floated on AIM in December 2006, raising £25m from investors. Forrester formed the business with the intention of acquiring dealerships and dealer groups that could be consolidated and improved.
He will not state a target size for his group, or give a timetable for growth. However, while at Reg Vardy, Forrester and Sir Peter Vardy specialized in buying under-performing dealerships and turning them round within two years.
Williams says he is delighted with the deal and pleased to accept a role within Vertu Motors.
He adds: “We had one or two approaches over the years and rebutted them but we felt Robert fulfilled two basic fundamentals – one: he has the ethos and culture of looking after people, as we have about 1,600 people here to consider; and two: he matched the share price aspirations that we had in mind.”
Williams will continue in his role of chairman of the RMIF’s National Franchised Dealers Association.
Bristol Street Group is a stable foundation for Vertu Motors business to build on, although it has no really premium brands. Forrester’s team is young, ambitious and respected by the industry and investors, and will be looking for a good spread of franchises.