Unipart Automotive secures new funding?

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Unipart Automotive reaches deal in bid to return to profitability. Car parts supplier born out of British Leyland completes fresh equity fundraising that will allow it to come back from years of losses

Unipart Automotive, the car parts supplier born out of the ashes of British Leyland, has completed a multi-million pound refinancing designed to return it to profitability after years of losses. The business, which is owned by Unipart Group and Dutch private equity firm H2 Equity Partners, is understood to have completed a fresh equity fundraising late last week.
The refinancing, structured by the accountancy firm KPMG, is believed to involve fresh equity injections from both shareholders. It is not thought that any external investors have backed the business as part of the deal.
Unipart Automotive had been losing £20m a year for a number of years, but that figure had reduced to the low single millions in recent years under the leadership of chief executive Mark Dixon.

The refinancing, which includes extending its £37.5m bank facilities, will allow the business to reach break-even as early as next month. The deal has, however, been accompanied by 150 job losses from the company’s 2,200 headcount.

Unipart Automotive has a network of 200 branches across the UK, supplying car parts to customers including the AA, Kwik-Fit and Nationwide Auto Centres.

One source close to the deal said that the company had had “a difficult past” but that the refinancing allowed for a brighter future.

Unipart Group sold a 50.1pc stake in Unipart Automotive to H2 in September 2011. Unipart Group, which is majority owned by its staff, was formed in 1987 through a management buy-out of the spare parts arm of British Leyland. The group is run by chairman John Neill, and has more than 10,000 employees.

KPMG is understood to have been retained to work with the company to look at future strategic options, not least how to compete with main rival Euro Car Parts.

Unipart Automotive and KPMG declined to comment.

A spokesman for Unipart Group said it did not comment on speculation.

SOURCE: http://www.telegraph.co.uk

Christopher Macgowan
@chrismacgowan

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