Marshall Motor Holdings adds 48 franchises including Toyota/Lexus dealerships with stunning £64.5m acquisition of Motorline
Marshall Motor Holdings has continued its phenomenal growth by adding 48 franchises after acquiring Motorline Holdings Ltd and its subsidiaries for £64.5million.
It means the Cambridge-headquartered group, which last week revised up its 2021 profit forecast from £40m to £50m, has major new partnerships with Toyota/Lexus and Hyundai and adds 1,500 staff to its roster.
The high-flying group, which funded the acquisition from existing cash resources, expects annual revenues to soar beyond £3bn following the deal. Last year, it achieved £2.15bn in spite of the pandemic.
Motorline, which has its headquarters in Canterbury, is a multi-franchise dealer group that operates across Kent, West Sussex, Surrey, Berkshire, Bristol, South Wales and the West Midlands, representing brands including Toyota, Lexus, Hyundai, Volkswagen, Audi, ŠKODA, Nissan, Peugeot and Maserati. It also has four Volkswagen Group trade parts specialist (TPS) businesses and five used car centres.
The deal represents an exit from the family business for the retiring brothers Glen and Thomas Obee, almost half a century after their father founded the business.
In 2020, Motorline recorded £695.2m revenue with profit before tax of £6.1m, although that included one-off items amounting to £4m, including a freehold disposal.
The company’s consolidated shareholder funds at completion are around £30m.
Daksh Gupta, Marshall Motor Holdings’ group chief executive, said: “We are delighted to announce the acquisition of Motorline in line with our strategy, which includes growing both further scale with existing brand partners and developing scaled relationships with selected new brand partners.
“Motorline is an extremely well-respected, long-standing business. The Obee family have overseen a significant expansion of the business in recent years and have invested in a market leading property portfolio.
“The acquisition has been funded from existing cash resources and is expected to generate attractive financial returns for our group.
“We are delighted to begin new and significant partnerships with Toyota/Lexus and Hyundai. These brands, with a combined market share in the UK of over 11 per cent, have been a target for the group for some time and the acquisition of Motorline provides immediate scale with each of them.I would like to thank each of them for supporting this acquisition and very much look forward to working with them over the coming years to develop a mutually successful partnership.
“I would also like to take the opportunity to thank our existing brand partners for their continued support for the further growth and development of the group for which we are extremely grateful.
“Finally, and most importantly, I would like to welcome our 1,500 new Motorline colleagues to the group. I look forward to meeting you soon and to working with you over the coming years.”
Marshall has also acquired a related freehold property for £2.9m and has the option to acquire two strategic freehold properties for £24.9m.
The company said it had been targeting entry into Toyota/Lexus, which is the world’s largest vehicle manufacturer and has about 7.2 per cent of the passenger market share in the UK. Motorline is the second largest retail partner for the brands, with 19 franchises.
It is also the second largest Hyundai retail partner in the UK, with seven franchises. Hyundai has about four per cent of the UK market share, and is the third largest vehicle manufacturer globally.
The move also cements Marshall’s position as the number one Volkswagen Group partner, adding new Volkswagen, Audi and ŠKODA sites, while strengthening its Nissan partnership by adding seven to its existing three.
The group becomes the fourth largest Nissan retail partner in the UK, and joint second for Peugeot, by adding four sites to its existing three.
Marshall, which has consistently beat the market for new and used car sales in recent years, said it now enjoyed 85.4 per cent brand coverage, which enable “synergies for used vehicle remarketing and fleet sales”.
Its geographic footprint now extends by eight counties to a total of 37 across England and Wales.
Glen Obee, ex-chairman of Motorline, said: “Following a period of almost 50 years from when our father founded Motorline in 1972 and having worked within our family business for over 40 years, my brother Thomas and I have decided to retire from the industry that we have enjoyed working within throughout our careers.
“We would like to pay tribute to the hard work and commitment of our employees and to our brand partners for their support and contribution to the outstanding success Motorline has been able to achieve.
“Under the excellent leadership of Daksh Gupta and his management team, the newly-expanded Marshall Motor Group will be even better placed to embrace the future dynamics of the changing motor sector.”
Motorline shareholders were advised by David Kendrick, head of automotive at UHY Hacker Young.
How the manufacturers responded
The move was welcomed by managing directors of the manufacturers.
Agustin Martin, president and managing director for Toyota GB, said: “We are delighted to welcome Marshall Motor Group into the Toyota and Lexus network at a time when the industry is going through significant change. We welcome their decision to make such a substantial investment into our franchises and we look forward to working with them to continue to build upon the strong and successful partnership we have consistently enjoyed with Motorline.
“We would like to thank the Motorline leadership team for their many years of dedicated support and partnership, providing exceptional representation for both the Toyota and Lexus brands. We are now excited about the future opportunity as the Marshall Motor Group and Motorline teams come together.”
Ashley Andrew, managing director for Hyundai Motor UK, said: “I am delighted that an organisation of the success and scale of Marshall Motor Group has made such a significant investment into the Hyundai UK dealer network. This move will further strengthen the brand in the UK at a time that we are enjoying record market share supported by a wave of new product introductions through this year such as all-new Tucson and IONIQ 5.”
Alex Smith, managing director for Volkswagen Group UK, said: “Marshall Motor Holdings and Volkswagen Group UK have enjoyed a successful relationship for a number of years across all our six brands and TPS trade parts operations. As the mobility industry continues to evolve towards a world of electric, digital, connected, and ultimately autonomous cars, partners with a clear vision such as Marshalls will continue to be crucial to satisfying the evolving needs of our customers”.
And Andrew Humberstone, managing director of Nissan Motors GB Ltd, added: “We are delighted that our key strategic partner, Marshall Motor Holdings, has expanded their representation with Nissan. This is part of our agreed expansion plan, fully complementing our growth strategy with this this highly valued partner. We thank Glen and Thomas Obee for their commitment and strong partnership with the brand over the years.”
Alison Jones, group managing director UK and senior vice president, Stellantis UK, said: “We are delighted to expand our relationship with Marshall Motor Group, a strong partner focussed on driving strong results and customer service, through strong teams. We thank the Motorline leadership team for their service, and look forward to the next chapter as the teams merge into Marshall Motor Group.”
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