CVC gets Kwik-Fit at knock-down price

After lengthy talks, CVC Capital Partners has agreed to pay Ford Motors £330m for the UK auto repair chain.

UK private equity firm CVC Capital Partners is continuing its buying spree within the European buyout market with the acquisition of UK auto repair and car servicing chain Kwik-Fit for £330m in cash.

The deal comes hot on the heels of the acquisition of French animal feeds manufacturer Provimi for just over E200m.

CVC acquires Kwik-Fit from Ford, which had hoped to sell the UK repair chain for as much as £800m when it announced a strategic review last year. Ford, which paid £1bn for Kwik-Fit in 1999, will record a one-time, after-tax charge of approximately $500m in the third quarter of 2002 related to the sale. 

Doubts had been cast over the prospects for a sale following the announcement last month that discrepancies had been exposed in Kwik-Fit’s accounts to the tune of £3.4m. Kwik-Fit had been receiving goods from suppliers but was failing to account for their cost with the resultant effect of increasing reported profits.

Ford will retain a 19 per cent stake in Kwik-Fit and remains on target to achieve $1bn in returns on the sale of its non-core assets. The sale was co-ordinated by Goldman Sachs.