Evans Halshaw puts Davenport under its bonnet in 31.5m pounds deal

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The Independent Online
EVANS HALSHAW is paying pounds 31.5m for Davenport Vernon, making it Britain's fourth-largest motor dealer above Cowie. The takeover increases Evans' number of dealerships from 58 to 86 and is being funded mainly by a pounds 29m rights issue.

Geoffrey Dale, chairman of Evans, said: 'We have been in close contact for three years. Shortly before Davenport made its profits warning in March they came to see us again to discuss the future.'

Davernport yesterday confirmed that its profits for the half- year to 31 March dropped 47 per cent to pounds 478,000 before tax. The interim dividend has been cut from 1.5p to 0.5p.

Evans is offering 100 of its shares for every 288 Davenport. Shares in Evans fell 31p to 484p, putting a value of 168p on Davenport's shares which climbed 45p to 158p. There is a full cash alternative of 155p.

Shareholders in Evans are being tapped for funds via a three-for-ten rights issue at 425p a share.

Evans is promising to lift the interim dividend for the half-year to June from 3.8p to 5p. The rise partly reflects a move to rebalance dividend payments by making the interim represent one-third of the total payout.

Mr Dale said one of the biggest benefits of the takeover was that there were few overlaps in terms of dealership location or the makes of car sold.

Evans will be introduced by Davenport to Volkswagen, Audi, Volvo and Honda. 'The enlarged group's interest with Vauxhall, Rover and Nissan will be particularly enhanced,' Mr Dale said.

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