1 June 2016 – acquisition

Vertu has announced that it has acquired the entire issued share capital of Gordon Lamb Group Limited and its subsidiaries, including Gordon Lamb Limited, for a total cash consideration of £18.7m.  This has been settled from existing cash resources.  Gordon Lamb operates the Toyota, Land Rover, Skoda and Nissan outlets in Chesterfield and the Skoda outlet in Derby, having traded for over 60 years.  The transaction includes goodwill of £8.3m and freehold properties valued at £7.5m.  The acquisition is an important development,in line with the strategy set out at the time of the capital raise in March 2016, bringing Toyota to the group’s offering.  For the year ended 31 December 2015 Gordon Lamb generated revenues of £85.8m, adjusted EBITDA of £2.9m, adjusted profit before tax of £2.7m and had net assets of £10.2m as at 31 December 2015.  The acquisition should be earnings enhancing in the first full year of ownership.  We continue to believe that the shares are a BUY.