With the lines, following the changes in EU Block Exemption regulations, becoming increasingly blurred between the independent aftermarket and franchised sectors, the news that the Lookers plc has acquired automotive parts warehouse distributor FPS must be seen as significant.
However, the franchise chain is adamant that FPS, which was the subject of a management buyout in 2001, will continue to be run as usual with the same personnel. “Everything to do with FPS remains exactly the same,” says Lookers chief executive Ken Surgenor.
The move by Lookers, which owns 86 dealers in the UK representing most of the leading vehicle manufacturers, is seen as a strategic one that will reduce the group’s dependency on new car sales.
FPS, which was established in 1934, operates a fleet of around 230 vehicles from 19 warehouse depots nationwide. Its annual turnover in the last financial year was in excess of £63 million. Lookers will pay £31 million in cash for the operation. This will be funded from existing cash reserves and new banking facilities.
The management buyout of FPS was achieved with the backing of venture capitalist ABN AMRO, which, according to FPS managing director Terry Wainwright, “was always looking to realise its investment at some point.” Now Wainwright believes that the Lookers acquisition will have “secured the long term future of FPS as an independent business.”