Haversham (HAV), the group formed by specialist investment house Marwyn and former Autologic chief executive Avril Palmer-Baunack, is reportedly in advanced discussions to buy Europe's largest second-hand car dealer, British Car Auctions (BCA), in a £1bn reverse takeover.
The deal is the second time BCA's American private equity owner Clayton Dubilier & Rice has tried to sell the company in the past six months, after the US group withdrew BCA from a planned public listing last October, blaming market volatility. This was despite "broad [investor] engagement and interest”, according to BCA, which owns the website webuyanycar.com.
Shares in Haversham were suspended on Monday following reports of the deal, although the shell company did not reference BCA in confirming a "substantial acquisition" was near. The group listed in November with the aim of acquiring "one or more quoted or unquoted businesses", giving it a platform for further deals in the automotive, support services, leasing, engineering and manufacturing sectors.
It is currently unclear whether Haversham, which has a market capitalisation of £31.6m, will use debt or equity to fund the deal. Co-founder Marwyn has an enviable track record of getting substantial returns out of the growth businesses it invests in. Its investment company Marwyn Value Investors, a favourite of Simon Thompson, holds a 4.8 per cent stake in Haversham. Its largest stake is in FTSE 250 film producer Entertainment One (ETO), and it has seen its net asset value appreciate 151 per cent in the last five years, during which time its share price has risen 213 per cent.
Haversham can also count on the backing of some major institutional shareholders, including Aviva and Schroders, as well as Invesco and Artemis, which respectively took 29.5 and 10 per cent stakes in the company in November.
