1 March 2016 – acquisition
The acquisition of Sigma Holdings Limited and its subsidiary Greenoaks (Maidenhead) Limited for a total cash consideration of £21.9m has been announced. In addition to the purchase of the share capital of Greenoaks, vendor shareholder loans of £9m have also been settled in cash on completion. This introduces Mercedes-Benz, Mercedes AMG and smart to the premium mix within the Group. Greenoaks operates Mercedes-Benz outlets in Reading, Ascot and Slough, with the Reading and Ascot outlets also representing the smart franchise and Ascot is an AMG performance centre. Greenoaks has represented Mercedes-Benz for over 30 years.
Each of the dealership freeholds is owned by Greenoaks which will add further to the strong freehold backing of the balance sheet. The total cash consideration of £21.9m includes initial consideration of approximately £18.4m and has been settled from existing cash resources and borrowing facilities. A further £3.5m is deferred for twelve months. The transaction includes goodwill of £13m. For the year ended 31 December 2015 Greenoaks delivered consolidated revenues of £88m, adjusted EBITDA of £2.4m, adjusted profit before tax of £1.2m and had net assets of £6.2m as at 31 December 2015. The acquisition is expected to be earnings enhancing in the first full year of ownership. We continue to believe in the strategy adopted by Vertu Motors and rate the shares as a BUY.