Tyre company 'leads £1bn race to buy Kwik-Fit'
Tyre maker Bridgestone was said to be in pole position today in the race to land Kwik-Fit, the £1bn (€1.5bn)-rated car parts and repair specialist.
The Japanese-owned company, which makes Formula One motor racing tyres, is thought to have already seen off interest from French rival Michelin.
Bridgestone still faces competition in the auction from at least five private equity houses, a report in the Financial Times said today.
It is likely rivals could include Kohlberg Kravis Roberts, the US-based venture capital firm which recently bought ATU, the German car parts firm. BC Partners and JP Morgan, which owns IMO Car Wash, have also made bids.
Kwik-Fit’s current owner CVC Capital, which acquired the business from Ford in 2002, said in April that it was pursuing a sale that analysts believed could value the Edinburgh-based company at between £800m (€1.2bn) and £1bn (€1.5bn).
The FT said a team of executives from Bridgestone had been in London since last month working on their bid.
The company has a strong presence in the United States through its Firestone unit, but has long been trying to crack the European market. It is thought to have looked at Kwik-Fit on the last occasion it was up for sale.
The UK business was established in 1971 and was sold to Ford in 1999 before CVC took it over for £350m (€518.3m) in August 2002. Ford bought Kwik-Fit for £1bn (€1.45bn) but kept a sizeable stake as part of the sale.
Since the takeover by CVC, Kwik-Fit has closed a number of sites in order to boost profitability and embarked on its first TV advertising campaign for more than five years.
And it recently appointed Ian Fraser, the former chief operating officer of mobile company Orange, as new chief executive.
The group – set up by Scottish entrepreneur Tom Farmer – has more than 2,300 outlets and 11,000 employees across Europe. It generated turnover of £854m (€1.3bn) and operating profits of £38.5m (€57m) in its financial year to the end of 2003.
