East Anglian car group sells Mercedes-Benz dealerships to US operator
PUBLISHED: 13:04 05 March 2018 | UPDATED: 13:04 05 March 2018
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A well-known East Anglian motor dealership has sold five high-end franchises to a US retailer.
Robinsons Motors Group has offloaded its Mercedes-Benz operations in Norwich, Bury St Edmunds, King’s Lynn, Peterborough and Cambridge to Group 1 Automotive, along with three Smart dealerships in the three cities.
Together, the five dealerships represented 45% of Robinsons’ trading turnover in 2017 and are expected to add around £188m to Group 1’s top line.
Martin Wallace, chief executive of the EDP/EADT Top100 company, said the deal would return value to shareholders but also release “resources and capital to deliver other opportunities”.
Family-owned Robinsons was founded in 1927 and over the past 91 years had grown to 28 dealerships across the region, representing Audi, Mercedes-Benz, Seat, Škoda, Smart, Citroen and Volkswagen.
The sale, which was advised upon by business advisers Grant Thornton and law firm Mills & Reeve, means that most of its remaining brands, bar Citroen, are part of the Volkswagen Group.
Mr Wallace said: “We are delighted to have concluded the sale of our Mercedes-Benz operations to Group 1 who we believe will be excellent onward employers for our team and will no doubt continue to provide excellent service for our customers.
“The advice and support we’ve received from both Grant Thornton and the team at Mills and Reeve has enabled us to return value to shareholders while also releasing resources and capital to deliver other opportunities in our sector.”
Group 1 Automotive is based in Houston, Texas, and is the third largest dealership in the United States, operating 175 dealerships, 230 franchises and 48 collision centres across the United States, UK and Brazil. It now has 47 dealerships in the UK.
Earl Hesterberg, Group 1’s president and chief executive, said: “We are pleased to further expand our global relationship with Mercedes-Benz through the addition of these five dealerships to our growing UK platform.”
In its latest published accounts, for the year to the end of December 2016, Robinsons reported record turnover and profit despite margins being slightly squeezed. Turnover grew from £341.469m to £378.213m, while pre-tax profit climbed from £6.522m to £7.608m, and the group employed an average of more than 700 staff.
Grant Thornton’s integrated team of sector, corporate finance and tax specialists advised on the process, executing a demerger before seeking a buyer for the Mercedes-Benz side of the business.
Steve White, director at Grant Thornton, said: “This was a complex transaction but working closely with Martin and his team, we have achieved a terrific result for the shareholders which will enable the business, with its long and illustrious history, to embark on the next chapter of its continued development within the sector.”
Mills & Reeve lead partner Craig Hodgson added: “We are sure that with Martin and his team at the helm in running their retained business it too will continue to grow and prosper, despite the challenges currently facing the motor retail sector.”
Robinsons Motors Group is a member of the EDP/EADT Top 100 list of Norfolk and Suffolk’s biggest companies by turnover.