Cambria Automobiles and Vertu Motors have both completed the acquisition of Leven Car Company dealership sites less than a fortnight after the Edinburgh-based retail group entered administration.
Cambria has entered the Scottish car retail market for the first time with the completion of the acquisition of Leven’s Aston Martin and Rolls-Royce Motor Cars franchises in Edinburgh from administrator Leonard Curtis Recovery Limited.
The deal was struck for a total cash consideration – including one freehold and one leasehold property and certain fixed assets – of £1.6 million to be funded from the group’s existing resources.
Vertu, meanwhile, has acquired Leven’s Kia, Suzuki and Mitsubishi leasehold multi-brand dealership site in Edinburgh to its Macklin Motors division, adding the three franchise points to a Scottish retail operation already comprised of nine outlets with Nissan, Ford, Mazda, Peugeot and Hyundai OEM partners.
The Edinburgh Evening news reported that the acquisitions completed by Cambria and Vertu had secured 101 of the 139 jobs that had been put at risk by the closure of Leven Car Company.
Commenting on the Cambria acquisition, group chief executive Mark Lavery said the group’s board was “delighted to have acquired these two great assets in Edinburgh, marking the group’s entry into the important Scottish market."
He added: “Aston Martin has been part of Cambria’s portfolio since the end of 2007 and this acquisition increases the group’s representation to four dealerships.
“This acquisition also adds Rolls-Royce Motor Cars to the group’s High Luxury segment and we are excited to welcome this prestigious brand to the portfolio.”
In a statement issued via the London Stock Exchange this morning Cambria said that, despite the Leven Car Company business’s failure leading to administration, its board expected the group’s acquisitions to be earnings neutral in the first full year of ownership, the year ending 31 August 2020.
Vertu Motors follows last week’s acquisition of four Volkswagen UK dealerships - in Leeds, Huddersfield, Harrogate and Skipton - from Sytner Group, for a consideration of £8.8m, with today’s news of further network growth.
Chief executive, Robert Forrester, took to Twitter to celebrate his latest acquisition.
Posting a brief comment last night (January 20), he said: “We have completed on the deal to buy Edinburgh Kia, Suzuki and Mitsubishi from the administrators of Leven Motor Co.
“This expands Macklin Motors and adds three new franchises.
“Will take us a few days to get the business back up and running but high hopes.”
Vertu said in its official statement that it expects its acquisitions to contribute a small loss in the first full year of ownership, the year ending February 28, 2021, and to be earnings enhancing thereafter.
It said that “marketing and operational synergies” are anticipated to arise as a result of adding additional scale to its business in Scotland.
The combined management accounts of the outlets acquired by Vertu indicate that they achieved pre-acquisition revenues of approximately £27m and a “significant trading loss”.
However, Vertu revealed that manufacturer support had been obtained for its transaction and a short-term lease entered into on the current premises.
It now plans to build a new multi-franchise dealership on land already purchased by the group, in Edinburgh, within the next two years.
Forrester said: “We are delighted to announce further expansion of the business in Edinburgh following from the acquisition announced last week in Yorkshire.
“This acquisition out of administration represents value, and brings the Kia, Suzuki and Mitsubishi franchises with growth prospects to the group.
“The addition of these outlets augments the group’s representation in Scotland under the Macklin Motors brand and expands our operational footprint in Scotland.
“In the process, we have also secured over 50 jobs which were under threat.
“The deal goes to the heart of the group’s strategy to continue to grow a significantly scaled franchised dealership group and to allocate capital in order to generate increased cashflows and returns for shareholders in the medium term.”