Halfords buys Nationwide Autocentres for £73.2m

Nationwide provides services such as MOTs and repairs in the consumer and fleet markets and Halfords said the tie-up “creates the largest UK operator with a specialised focus on the car parts, servicing and repair market”.

Another 200 outlets will be opened “in the coming years” and the deal is expected to deliver cost and purchasing synergies.

The business, to be rebranded Halfords Autocentres, is expected to double EBIT to £20m in the third year of ownership. In the year to December 31 2009, EBITDA – which has risen 70% over the last four years – is expected to be £10.1m on sales of £97m.

The acquisition was done on a debt-free basis funded from Halfords existing resources.

Halfords chief executive David Wild said: “We have grown strongly in this market through the provision of expert advice and our Wefit services, and Halfords Autocentres will complement our retail business closely.

“Customers trust the Halfords brand and we are sure that a national chain offering great service and MOTs at fair prices will be popular and successful.”

Broker UBS said: “This is not the first time Halfords has been in the car servicing business.

“Under Boots’ ownership it operated a number of own-brand service centres but a reputation for poor service and low utilisation of the fixed cost base led to a decision to exit.

“In Nationwide, Halfords has acquired a leading business already at scale. We are comforted by the retention of the existing management and do not expect history to repeat itself.”