Upgrading their rating to “buy”, Jefferies analysts said: “Siemen’s recent spin-off of Energy gives confidence that Conti’s share price will benefit from its planned spin-off of Vitesco as the combined market cap of Siemens and Energy was up 7 per cent on the day of transaction (DAX +3%)” The implication, they explained, was that there was a discount in Siemens’ sum-of-the-parts valuation. That being the case, given Conti’s “more attractive transaction structure”, the analysts predicted that Conti’s “re-rating should be more pronounced.”
The recent news that Continental AG will close its Aachen, Germany tyre factory underlines the fact that it is aiming to cut 13,000 of 59,000 jobs in Germany as part of a major group-wide cost-cutting programme. Now, the German Manager Magazin is reporting that Continental is also considering the sale of parts of the wider group. Indeed, Continental is said to be in talks “already with prospective customers”. The Rubber Technologies business sector, which includes Continentals Tire and ContiTech division is also said to be affected.
The UK’s largest tyre retailer, Kwik Fit, is being prepared for a sale. The Japanese Itochu group, which owns the European Tyre Enterprises Ltd (ETEL) holding company that controls both Kwik Fit and its wholesale counterpart Stapleton’s Tyre Services, has appointed investment bankers Nomura to advise on strategic options for the company, according to Sky News, with insiders suggesting a sale is very likely.
The Committee and Council of the Foundation “Salon International de l’Automobile” has today decided it will not organise a Geneva International Motor Show (GIMS) in 2021, it will not accept a loan from the State of Geneva and moving forward the sale of GIMS to Palexpo SA is the preferred solution. Organisers had previously said the 2021 show was “very uncertain”.
According to the company’s executive chairman Ian Edmondson, the goal is to find a suitable partner to help the company continue to move forward at its current rate of positive growth: “Our shareholders are now seeking to find a new investor who is in a position to help the business maintain the outstanding growth record that it has delivered in recent years.”
Titan International, Inc. has engaged Goldman, Sachs & Co. to advise on the sale of its Italtractor ITM S.p.A. subsidiary on 25 April 2016. The news follows the announcement that the firm had established a special committee of its board of directors to review and analyze the issues relating to the possible sale of ITM. These moves and the language of the legal disclaimers attached to the official statements announcing them suggest Italtractor is now well and truly up for sale.
Martin T Coyne & Matt D Hardy of Birmingham based Poppleton & Appleby have been appointed as joint administrators of Tyretraders.com Ltd. Overhead expenses, rising costs, the fall in tyre prices and investment that apparently outpaced growth of the business are all said to have led to the company entering administration. Moving forward, the administrators aim to sell the business as a going concern.
Cooper Tire & Rubber Company reports that it has completed the sale of its 65 per cent ownership in Cooper Chengshan (Shandong) Tire Company Ltd (CCT) to Chengshan Group Company Ltd on 1 December for approximately US$262 million net of taxes and including dividends in accordance with the previously announced option agreement. Earlier reports suggested […]
Euro Car Parts acquired 27 former Unipart Automotive branches yesterday (7 August). Following negotiations with Unipart Automotives’s administrators, Mark Orton, Will Wright and Jonny Marston from KPMG, Euro Car Parts has secures the sites across England, Scotland and Wales, taking the ECP network to 194 branches. At the same time Parts Alliance reported it had taken on over 500 ex-Unipart Automotive works.
Kwik-Fit has reportedly been sold to the Japanese conglomerate that owns Stapleton’s, Itochu Corporation. According to a City AM report, the deal follows the signing of a three digit million pound deal yesterday (1 March 2011). The article suggests Kwik-fit’s former owner, private equity firm PAI Partners” has “cashed out” of its six-year ownership of the chain for “£637 million, which includes net debts of £457 million.” A Kwik-Fit spokesman refused to confirm or deny the reports when Tyres & Accessories asked for confirmation of the news. Either way, the reports suggest the deal is still subject to regulatory approval.
HiQ has unveiled plans to “accelerate” the company’s franchise offer by transferring 109 existing company-owned stores into 15 regional zones for regional as well as national investment. The news came in parallel with the launch of HiQ’s sponsorship of this year’s British Touring Car Championship. Company representatives told Tyres & Accessories that this seven figure motorsport investment represents the single largest marketing investment Goodyear Dunlop has committed to the HiQ brand.
In a further twist, HiQ managing director Neil Burrows announced that he and “three members of the management group” are interested in investing into a “significant part” of the network themselves, demonstrating they really are willing to put their money where their mouths are regarding the franchise’s development. Therefore, in the interests of transparency, Neil Burrows and the other three as yet unnamed managers will be assigned to special projects (such as managing the BTCC sponsorship deal) within the Goodyear Dunlop group.
The news that Goodyear Dunlop is effectively franchising-off 109 of its retail outlets also goes some way to further explaining the recent decision to transfer former Goodyear Dunlop Commercial Director, Robin Sharpe, to “special projects.” With Burrows team’s decision to bid for HiQ in mind, it now appears that Sharpe will manage the HiQ team until the final announcement regarding the franchising of the HiQ equity branches has been announced.
Goodyear Dunlop representatives told T&A that the jobs of all those involved are secure and, in the event that their bid is not successful, they will be free to return to their former positions. The company will be unveiling details of its nationwide franchising programme on 31 March, with the definitive structure following in the summer.
At the time of the announcement Goodyear Dunlop Managing Director Mark Brickhill stated: “The fact that Neil and his team wish to invest in HiQ is a signal of the confidence that management have in the future success of HiQ. However, it is vital that we have complete independence and transparency during the franchise application period, which is why we have appointed Robin to lead the HiQ team during the next few weeks.”
“There are huge opportunities in the vehicle servicing market due to the lifting of restrictions on who can carry out servicing work on vehicles without affecting warranties. This, coupled with aggressive new product development plans from Goodyear and Dunlop, means that HiQ is in a strong position to grow significantly over the coming years.”
The total number of HiQ outlets nationwide as of February 2008 stands at approximately 120. The three-year plan unveiled last year is to more than double this number by 2010. The target now is for 60 more retail franchisees to have joined the network by the end of 2008.
Neil Burrows has previously stated that the company is initially interested in attracting franchisees in the North West and within the M25. While this is still true, the strategy for 2008 is also to fill gaps in the market. For example, at the time of going to press, there wasn’t a single HiQ outlet in Norfolk. “Longer term we are not limiting ourselves to 250 outlets,” Burrows commented, explaining that in the future retail outlets would be run by a combination of single centre owners and multi-store franchisees. The example of one franchisee in Cumbria exemplifies the way a multi-store franchise might operate. This franchisee is exclusively responsible for HiQ sales in the Lake District and as such he has the opportunity to enter into dialogue with the company regarding development of further HiQs in the area.
Over a year since HiQ relaunched itself as a car and van only tyre specialist, plans to upgrade the look and feel of the network continue to progress. 30 outlets are already refurbished in what are still the early stages of three to five year upgrade plan. HiQ’s novel use of the Internet as a sales tool is also said to be expanding following the system’s soft launch last August. While sales generated through the online system still represents “less than 5 per cent” of overall sales, this is expected to increase significantly as the company adds additional tyre brands and servicing options to the system.
Seven-figure sponsorship investment
While the launch of HiQ’s maiden year as title sponsor of the British Touring Car Championship (BTCC) may have been upstaged to some extent by the news of the radical changes within HiQ’s ownership structure, it would be a mistake to underestimate the significance of this deal.
“The HiQ business is a core part of Goodyear Dunlop’s plan for profitable growth and [the] HiQ MSA British Touring Car Championship launch is evidence that we are continuing to invest to build HiQ as a vital channel to market for us. The HiQ network growth will be through franchising. Our existing franchises have been tremendously successful and there is significant interest from existing and potential new franchisees in joining us to invest in HiQ,”
During the BTCC/HiQ launch press conference Neil Burrows explained that he first entered talks with the BTCC series director and administrator on the subject of a sponsorship deal roughly a year ago. According to Burrows, the arrangement works at every level and the partnership “really has legs” for future development.
One example of this is the running of race evenings in outlets near race meetings, featuring racing stars and experts. The first of these will take place at the HiQ in Grays, Essex, and is expected to present a strong PR and promotion opportunity for the brand. Apparently the only problem with this kind of event is there isn’t enough races in the season to cover all 120 HiQs.
Another example is the discount promotion HiQ is currently running, with HiQ offering discounts of up to 20 per cent on “race track inspired” Dunlop tyres at stores across the country as a way of celebrating the tyre retail chain’s first year as sponsor of the British Touring Car Championship.
“We are delighted to be sponsoring the MSA British Touring Car Championships. It is a huge development for HiQ and we want to share our delight with customers. We have agreed to knock 20 per cent off a range of brands,” HiQ managing director Neil Burrows commented, adding: “The BTCC has proved that it can deliver high value of advertising worth, with live ITV coverage, the biggest UK motor sport attendance figures and broad media exposure. It gives HiQ a perfect opportunity to promote our unique offering as we re-launch and grow our network across the UK.”