Fleet Hire offers traditional multi-year vehicle leasing to UK corporates, as well as Car Salary Exchange, it’s rapidly growing salary sacrifice product. The business has a fleet size of approximately 6,500 vehicles and a range of long-term customers across various industries, from SMEs to large listed entities. The management team had successfully grown the business, securing several flagship contracts and demonstrating the potential of the Car Salary Exchange brand, and the shareholders felt the time was right to crystallise the value created in the business.
SG Fleet is a significant player in the international fleet management leasing industry, with operations in Australia, New Zealand and the UK. It manages in excess of 83,000 vehicles and is a leading provider of vehicle salary packaging solutions in the Australian market. In recent years, SG Fleet had stated its intent to grow its small existing UK operation, and had retained a strategic interest in acquiring Fleet Hire, and bringing on board its highly regarded incumbent management team, as a way to develop a much larger UK presence.
What difference did we make?
We were appointed to undertake a strategic review of the business, elicit interest from both trade and private equity bidders and optimise the process in order to deliver maximum shareholder value and find a good home for the business.
SG Fleet was known to be interested in acquiring Fleet Hire. However, our strategic review highlighted that several other parties would also be attracted to Fleet Hire’s investment case. Various offers from both trade and private equity bidders were secured to provide assurance that SG Fleet’s offer included a suitable strategic premium to reflect the strong investment rationale and potential synergies between the two businesses.
Our knowledge of SG Fleet’s operations and the relationship we built with them enabled us to articulate an attractive, tailored investment proposition to them. This put us in a position to negotiate an attractive post-transaction incentive structure for the Fleet Hire management team, whose retention was key to SG Fleet’s strategic objective.
Project management was key given the buyer was listed in Australia and the timing of the transaction process had to be handled delicately. With used vehicle values declining every month, increased HMRC scrutiny on the Car Salary Sacrifice sector and the timing of Brexit, significant wider commercial obstacles were overcome to deliver a double-digit exit valuation multiple for the selling shareholders.
Forward Group (majority shareholder)