South West car sales business sold for £6.2m
A car sales business which has been trading for 90 years has been bought for £6.2m.
National chain Vertu Motors has acquired Rowes Garage Limited in a deal which was announced on the Stock Market.
Vertu Motors has a network of 193 sales and aftersales outlets across the UK and a sector leading online presence.
It has announced that it has bought the Rowes Group which has four garages in the South West.
Rowes has been trading for over 90 years, growing to become one of the most successful Honda dealer businesses in the UK.
The outlets operated by Rowes represent the Honda franchise, and are located in Plymouth, Plymstock and Truro.
The business also operates a Suzuki franchised outlet in Plymouth, which will continue to operate as a used car outlet and Suzuki authorised repairer on acquisition and will be refranchised in due course.
The business will be rebranded to trade under the Vertu and Bristol Street Motors brands immediately augmenting the group’s presence in the South West.
Following the successfully integrated Helston acquisition in December last year, the group operated 30 sales outlets in the South West and this latest acquisition, results in 34 outlets now being operated in the region.
This is the first time the group has operated in Plymouth.
In addition, further scale is added to the relationship the group has with Honda and will now operate 17 outlets for the brand. The group was already Honda’s largest retail partner in the UK.
For the year ended 31 December 2022, Rowes Garage Limited achieved revenue of £30.2m and an operating profit of £745,000.
Consideration, net of cash acquired, is estimated at £6.2m, subject to finalisation of completion accounts.
The consideration includes freehold properties with a value of £3.6m and a payment in respect of goodwill of £900,000.
This consideration will be paid from the group’s existing cash resources.
Due to the seasonality of vehicle sales, the business is expected to contribute a loss for the remaining four months of the financial year to 29 February 2024 and is expected to be earnings enhancing in its first full year of ownership.
Vertu chief executive Robert Forrester said: “I am delighted to deliver further expansion for the group in the South West of England following the successful and accretive Helston acquisition. The long standing successful Rowes business is a great addition to the Group’s 14 existing Honda sales outlets and increases scale further in the South West where we will operate 34 outlets. We continue to execute our strategy to build a scaled business.”
