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On 20 June 2023, Global Auto Holdings Limited (an English private limited company owned by Canada-headquartered Alpha Auto Group (AAG)) its £465.4m deal with Lookers plc (Lookers), a UK motor retail and aftersales service group. The offer value represents a 35.3% premium on Lookers’ closing share price on the last business day prior to the start of the offer period. The market reacted positively to news of the deal as Lookers’ share price increased by 34% following the announcement of the takeover. 

In the last four years, the UK motor giant has experienced fluctuating financial performance ‘weakness in consumer confidence in the light of political and economic uncertainty, pressure on used car margins and retail cost inflation’ and the ‘UK new car market … continu[ing] to contract.’ Such market conditions were aggravated by the ‘closing [of] all of its trading locations’ during the pandemic. Adding to its tumultuous financial performance, the Company’s sale processes were also made subject to an in June 2019, which ultimately led to its in 2020. After its in January 2021, Lookers unveiled an the following year – the review was ‘designed to build on the Group's strong market position, excellent brand partner relationships and valuable property estate’, focusing on, amongst other things, operational optimisation, investment in technology and digitisation, and expanding original equipment manufacturer (OEM) relationships. 

In line with this revised strategy, AAG’s offer allows Lookers to ‘benefit from a balanced OEM brand portfolio which is well diversified across segments with strong OEM brand partnerships in North America, the United Kingdom and Ireland, which will help position the combined business to effectively navigate global headwinds.’ Mark Raban, Chief Executive Officer of Lookers, commented on the deal:

‘Today's offer reflects the transformational progress that has been made in recent years. We have harnessed our strong market position, enhanced our brand relationships, and executed well against our six strategic priorities. I am excited about the combination with [AAG]. It will create a business of greater scale, and bring together two successful businesses with complementary OEM relationships, and a strong platform to support future growth in the UK.’

The acquisition also aligns with , which focuses on strong relationships with manufacturers and growth via acquisition with ‘a specific focus on North America and Europe.’ Kuldeep Billan, Founder and Executive Chairman of AAG, commented:

‘The proposed acquisition of Lookers represents a compelling opportunity to acquire one of the leading UK auto retail groups while partnering with fantastic OEM brands and Lookers' approximately 6,500 strong team members. We look forward to further building upon Lookers' strong OEM relationships by being a trusted and reliable retail partner while delivering strong volumes and a high level of customer experience across a range of OEM 'go to market' strategies.’

Trends surrounding public to private transactions will be explored in more detail in our upcoming H1 2023 Public M&A trend report.