Motoring services firm Lex Service bought Auto Windscreens, Britain“s second largest car windscreen replacement company, for 112 million in the week of 26 March.
The move is in line with Lex“s swi…
Motoring services firm Lex Service bought Auto Windscreens, Britain“s second largest car windscreen replacement company, for 112 million in the week of 26 March. The move is in line with Lex“s switch to a service-oriented business, after the sale of its car retailing business last year, and the acquisition of the RAC national breakdown recovery service in 1999. Initially, both businesses will be run separately, but Lex will gain savings as it merges the operations, which includes a fleet of 800 Auto Windscreens“ vans, to its existing RAC fleet of 1,250. Analysts believe the deal is likely to realize significant savings from Lex“s network of 140 car service and repair outlets, called Lex Autocentres, and Lex“s car and van leasing services and fleet management divisions. News of the deal lifted Lex“s share price by 3.9% to 47612 p, just below its 16-month high of 479 p, valuing the company at 557 million. Auto Windscreens, which made a profit of 4.1 million in 2000, on a turnover of 92 million, was thought to be in talks with Centrica, the owner of rival recovery organization, the Automobile Association, as late as February. The auction of the group, however, was secured with a payment of 42 million for Auto Windscreens“ equity, with the assumption of 70 million of debt. The purchase arises after a 17.5 million pre-tax annual loss was posted by Lex last month, after a downturn in used-car prices last year. For the full year, Hallum increases his forecast of pre-tax profits from 66 million to 69.5 million and increases earnings per share from 40.3 p to 4212 p.