The management team behind the world's biggest chain of conveyor-belt car washes made £30m yesterday as it changed hands in a deal worth £350m but then ploughed most of the proceeds back into the business.
The four executive directors of IMO, who are staying on after the group's disposal via a secondary buyout to a US private equity group, cashed in a "small amount" of their proceeds.
Bret Holden, who joined the company five years ago as chief executive, said: "Hopefully in the future we'll have a chance to take a lot more out."
The four men own about 25 per cent of the group, which was founded in 1965 by a German family that made equipment for car washes. The business was broken up in the Nineties, with its British arm going for £138m in 1998 to a group of venture capitalists led by Bridgepoint. Since then, the business has more than doubled in size, to 800 sites across 12 European countries, helped by the £80m acquisition of the group's German division in 2002.
IMO's new owner, JP Morgan Partners, said it planned to roll out hundreds of new sites across Europe. "We plan to aggressively grow the business; we want greater coverage in our markets," said Stephen Welton, who oversaw the deal for the private equity group.
Car washes have soared in popularity as our love affair with the car has flourished. The cost of a lather, scrub and shine for your humble Mini Metro was added last year to the basket of consumer goods that the Government uses to fix the inflation target - proof of how mainstream the business has become.
Mr Welton said there was scope for IMO, which also trades as ARC, to increase its presence in the UK from 300 sites to up to 500.
Mr Holden said being owned by a US-based private equity group meant expanding beyond Europe was "an option". IMO's appeal as a car wash destination lies in its conveyor system (as opposed to the more conventional "rollover wash" method), which means it can wash up to 90 cars an hour. At just £1.99 for a basic wash, having a clean car costs less than a pint, making the business virtually recession proof, he added.
Bank of Scotland provided the debt financing for the deal, while JP Morgan advised its private equity division on the deal. Bridgepoint is thought to have tripled its original investment.Reuse content