City round-up: Lookers; James Fisher Group
Altrincham-based car dealership chain, Lookers, has acquired vehicle hire and brokerage business, Fourways Vehicle Solutions, for an undisclosed sum.
The business, based in Whitchurch, Shropshire, and provides a UK-wide vehicle rental service, using a combination of its own fleet of vehicles and its vehicle rental broking arm, which has access to more than 75,000 vehicles from some of the UK’s major rental companies. Fourways manages in excess of 7,000 rentals per annum and in 2022 had total revenue of £3.8m.
Lookers sees significant opportunity for Fourways to grow its market share and to cater for Lookers’ own rental requirements at lower cost and with greater certainty.
The acquisition fits with one of the group’s key strategic priorities to leverage its corporate leasing and fleet capabilities.
Fourways will sit within Lookers Vehicle Solutions, the umbrella brand for all corporate operations, with significant growth potential. Lookers recently completed its consolidation of operations within Lookers Vehicle Solutions and has a good platform to continue building this part of the group.
Chief executive, Mark Raban, said: “We are very excited to welcome Fourways to Lookers. Over the last 20 years, the team have built a reputation for providing industry-leading service to many high profile customers seeking corporate vehicle solutions.
“With the consolidation of our own leasing business now complete, we are excited to add further scale to the division. Fourways is another step on our journey to grow our leasing and fleet platform, building and improving our offering for an increasing customer base.”
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Jean Vernet
Barrow-based marine services group, James Fisher, has disposed of James Fisher Nuclear Holdings and related properties, to Myneration, a wholly-owned investment vehicle of Rcapital Partners, for a nominal consideration of £3.
The sale forms part of the board’s ongoing commitment to rationalise and focus the group’s portfolio. Last December the group sold three businesses, in two separate transactions.
Mimic and the UK operations of Strainstall were sold to the BES Group for £13.6m, with a further £3.9m payable this year, depending on performance. The third sale was of Prolec, which makes safety monitoring equipment for the construction industry, and has been sold to German group Kinshofer, part of Lifco AB.
Existing James Fisher Nuclear Holdings management and staff will remain with the business as it transitions into new ownership and Rcapital will provide JFN with a £3m secured revolving credit facility to fund the growth of the business going forward.
Following completion, an unsecured loan of £1.2m which has been made available by the group to JFN will remain outstanding. It is anticipated that the amount outstanding under that loan will be repaid by JFN shortly after completion. In addition, the group will make a secured interest-bearing term loan facility of up to £3.5m available to JFN.
JFN is a supplier of specialist engineering, manufacturing and technical services to the UK’s nuclear decommissioning industry. In 2021, the business generated third party revenue of £51.7m and a loss before tax of £0.1m. At June 30, 2022, the unaudited gross assets of the business were approximately £36.4m and its net assets were approximately £17.5m, of which goodwill represented £8.1m.
As a result of the transaction the group will impair the value of goodwill and tangible fixed assets associated with the business in its results for the year ended December 31, 2022.
James Fisher chief executive, Jean Vernet, said: “The sale of JFN is a further step in the implementation of our strategy to rationalise and focus the portfolio and, taken together, the business and asset disposals made over the last three months are important steps in streamlining the group’s operations and strengthening the balance sheet. JFN has some valuable and unique capabilities and requires the right investment to exploit the market opportunities in front of it.”
Josie Richardson, investment director at Rcapital, said: “JFN plays a crucial role in the UK’s nuclear decommissioning industry and, hence, the delivery of the Government’s strategic energy plan. Its management team, market-leading technical services and unique UK-based experience in specialist fields put it in a strong position. We are pleased to have the opportunity to support the business as it enters a new phase of growth and development.”
Fisher also released a trading update for the year to December 31, 2022, ahead of publication of the results on March 28.
It said it made good strategic and financial progress during 2022, disposing of three businesses, agreeing the sale of the Swordfish dive support vessel and generating good revenue and underlying operating profit growth across the Marine Support, Offshore Oil and Tankships divisions.
The Specialist Technical division experienced a disappointing year, with JFD at a trough in its long term projects cycle and JFN, which will be reported as a discontinued operation, reporting an operating loss following ongoing project challenges.
For the year ended December 31, 2022, the group is expecting to report revenue from continuing operations of circa £475m, compared with £442.4m in 2021. Underlying operating profit from continuing operations is anticipated to be in line with 2021.
The three business sales completed in December 2022 generated gross proceeds of around £18.4m. Net bank borrowings at December 31, 2022, were circa £135m, with the group expecting to remain within its banking covenants.
The sale of the Swordfish Dive Support Vessel, which was announced in December 2022, completed in January 2023, with cash proceeds of approximately £20m now received. The group said it has commenced discussions with its lending group regarding existing borrowing facilities, which have maturity dates ranging from October 2023 to September 2024.
