Ford to buy Kwik-Fit for pounds 1bn

FORD, the giant motor company, yesterday launched an agreed takeover of Kwik-Fit in a surprise deal that values the Edinburgh-based tyres and exhaust company at pounds 1bn.

Ford said the takeover was part of a drive to move from its image as a motor manufacturer and turn itself into the leading consumer services company in motoring.

Kwik-Fit shareholders will be offered 560p in cash for each share, a 32 per cent premium to their Friday closing price of 419p. Shares in Kwik-Fit soared, climbing 28 per cent to close at 541p. Other motor service retailers rose in sympathy, including Lex, up 38p at 469p.

The deal gives the car giant greater access to after-sales markets in Europe, with control of 1,900 garages in the UK, Belgium, France and Germany.

Ford executives said they would service competitor's cars for the first time, and offer enhanced service on its own cars over two years old.

Jacques Nasser, president of Ford, said: "Kwik-Fit is an outstanding company that has earned a leading position in the fast-fit market and created a successful customer formula - innovative high value services with convenient locations and knowledge of the customer."

While executives talked of "outstanding growth potential" and significant synergies, they said no job cuts were planned. Ford is retaining the services of Sir Tom Farmer, Kwik-Fit's founder, chairman and chief executive, who will remain in charge of the company he set up 28 years ago. He will also join the board of the Ford Consumer Services Division (FSCSD). Directors of Kwik-Fit are unanimously recommending the offer.

A Ford spokesman said the first talks began "several months ago" after Ford approached Kwik-Fit. "What we were looking for was the best aftermarket company in the world," he said. "This is not just about Europe but about the world. We concluded that Kwik-Fit was the best."

Analysts yesterday said they were surprised that Kwik-Fit had decided to talk to Ford, in spite of a mild profits warning late last year.

"It is a company that has always made great play of its independence and was doing quite well enough on its own," said one. "It was probably panicked into talking by the profits warning."

Joe Dickinson, an analyst with leading motor market consultants AT Kearney, said the deal underlined Ford's strategy of vertical integration, buying car dealers in the US and increasingly using its brand to move into retail services.

Ford said it intended to accelerate the Kwik-Fit European expansion, which involved buying the Speedy chain of motor services outlets last year.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Business Development Executive - Affiliates & Partnerships

£20000 - £35000 per annum: Recruitment Genius: This multi-award winning foreig...

Recruitment Genius: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Recruitment Genius: Annuities / Pensions Administrator

Negotiable: Recruitment Genius: You will be the first point of contact for all...

Ashdown Group: HR, Payroll & Benefits Officer - Altrincham - up to £24,000.

£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...

Day In a Page

No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat
Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

Saudi airstrikes are fuelling the Gulf's fire

Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

The only direction Zayn could go

We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

Spells like teen spirit

A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

If fashion is a cycle, this young man knows just how to ride it

British designer Jonathan Anderson is putting his stamp on venerable house Loewe
Number plates scheme could provide a licence to offend in the land of the free

Licence to offend in the land of the free

Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

From farm to fork in Cornwall

One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

Robert Parker interview

The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
Don't believe the stereotype - or should you?

Don't believe the stereotype - or should you?

We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor