20 February 2013
Inchcape plc
Inchcape acquires the leading luxury and premium automotive group in Australia
Highlights
· Trivett Automotive Group to be acquired for £78m
· Scale presence with luxury and premium brand partners in Sydney
· Expands Inchcape's operations in Asia Pacific
Inchcape plc ('Inchcape' or the 'Group'), the leading independent international automotive distributor and retailer, today announces an important step in the further development of its Asia Pacific presence. The Group has entered into an agreement to acquire Trivett Automotive Group ('Trivett'), a luxury and premium automotive group in Australia, on March 1st 2013 for a total expected cash consideration of £78m. This transaction adds further scale to Inchcape's Australian business, which benefits from attractive automotive demand characteristics and robust economic fundamentals. Inchcape has been operating in Australia since 1992 and sells approximately 50,000 vehicles in the country through its distribution and retail network.
Trivett Automotive Group
Trivett is the largest luxury and premium automotive group in Australia, representing a number of world leading premium brands, including BMW, Jaguar, Land Rover, Volvo and Honda and highly aspirational, super-luxury brands such as Rolls-Royce, Bentley, Aston Martin and McLaren. Trivett operates 22 retail centres in three market areas in Sydney, Australia's largest metropolitan area for luxury and premium brands.
Trivett sells 9,000 vehicles per year. Revenue for the 2012 calendar year was £390m and EBIT was £12m.
The cash consideration represents a multiple of 5.6x calendar year 2012 EBITDA and a multiple of 4.4x ex property (see note 2). Trivett has 10 freehold properties in Sydney with a current market value of £31m. Following this transaction, Inchcape's balance sheet remains strong and the company retains a net cash position.
Australian Vehicle Market
The fundamentals of the Australian new vehicle market are strong. Recent growth in automotive demand has been broad based, involving both the wealthy metropolitan areas and the mining territories. 2012 saw the new vehicle market grow by over 10% year on year to 1.1m units, a record level.
Looking further out, the sound prospects for the Australian vehicle market are supported by a number of factors, including net immigration and a growing population complemented by low unemployment, a robust financial sector and favourable structural demand for commodities. The combined draw of aspirational automotive brands and advanced technology underpin a continuation of the premiumisation of demand from the growing middle class in Australia.
André Lacroix, Group Chief Executive of Inchcape plc, commented:
"This is a significant step in the development of our operations in Australasia, giving us the opportunity to build further scale with premium and luxury brands represented in high quality retail centres in Sydney.
The transaction is in line with our strategy of expansion in Asia Pacific and Emerging Markets with luxury and premium brand partners. Trivett is a high quality operation and an excellent fit for Inchcape.
We will leverage our deep market knowledge, strong operational capability and superior processes to deliver outstanding customer service for our brand partners and to drive value for our shareholders."
Ends.
Group Communications, Inchcape plc
+44 (0) 20 7546 0022
Investor Relations, Inchcape plc
+44 (0) 20 7546 8359
FTI Consulting (Jonathon Brill/Billy Clegg)
+44 (0) 20 7831 3113
Conference Call
There will be a conference call for analysts and investors at 8:00am GMT, the details of which can be obtained from FTI Consulting.
Notes to editors
1. About Inchcape:
Inchcape is the leading, independent international automotive distributor and retailer operating in 26 markets. Inchcape has diversified multi-channel revenue streams including sale of new and used vehicles, parts, service, finance and insurance.
Inchcape's vision is to be the world's most customer-centric automotive retail group and represents some of the world's leading automotive brands, including Audi, BMW, Jaguar, Land Rover, Lexus, Mercedes-Benz, Porsche, Rolls-Royce, Subaru, Toyota and Volkswagen.
Inchcape, which has been listed on the London Stock Exchange since 1958, is headquartered in London and employs around 14,400 people.
www.inchcape.com
2. The cash consideration less the current market value of Trivett's freehold property divided by Trivett's calendar year 2012 EBITDA less notional rent on the property.
3. Greenhill & Co. acted as financial adviser to Inchcape on the acquisition of Trivett.
4. About Trivett:
http://www.trivett.com.au
