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Anyone care to hazard a guess as to the size of offer that would represent fair value for this company?
A Cazoo bid to secure them a reliable source of used car stock? (like Constellation have done with Marshall).
Yes, could be him or PE and him.
Key is Tony Bramall
Must be a PE bidder. No other plc moving in reaction. I guess we will know tomorrow.
Looking at the bought/sold again on this site I see
Vol. Bought 14,356,572
Bought Value £14,475,060.39
So over £1 a share ?
...or have I missed something ?
bid at 90p I would be my bet
I can sell on AJ Bell now for 86p, so that bit's not a glitch.
The SP page here shows 14m shares bought today & only 1m sold
I was wondering if there was a glitch ?
Sudden spike to 86p then down a little & spread increased to 2p
Can't see trades that far back...
Something brewing here me thinks. Big uplift in SP?
What Lookers very much need to do is ensure they are aligned well with the correct EV OEM's, and also watch their service work as EV penetration takes hold as they need less service work, so therefore assume lower service costs and spares costs etc. Their small move into smart repairs shows they are thinking about this, but need to ensure the transition to a bigger EV parc in the future is executed well. Hope this management team have the out of the box strategic thinking to do this? The past certainly did not!
@MIkeClarke
The EV subsidies announced last week should help Lookers sell more EVs
https://fleetworld.co.uk/new-salary-sacrifice-scheme-to-make-switch-to-evs-a-no-brainer/
ING good
Secondhand car prices up hugely say the ons in their cpi report and that should drive margins higher !
Enough said
This is a very profitable and asset rich company with a P/E in 2021 of around 3.
It strikes me that a) this is absurd and b) that there is an extraordinary amount of upside to this.
Is this a win/win strategy to either take a much increased share of the second hand market, which is already substantial from their dealerships, or make them ripe for a takeover from one of the new entrants eventually who are loaded with bucket loads of cash?
Interesting find MikeClarke. I re-read the trading statement and group strategy update from which I have copied the following statement from item 4, increasing used vehicle penetration.
The Board continues to believe that the scaled used vehicle market presents the Group with a significant opportunity, as evidenced by several recent new entrants to the market. So yes it does look like Lookers are going compete head on with Cazoo and Cinch. Great to see a proactive board of directors now.
I also see that Lookers opened the second Polestar site in the Trafford centre around Christmas, and whilst this would not have consumed too much cash, it just shows how the company is re-positioning itself, here with a Chinese EV manufacturing company. With its new second hand cars site, a fleet of delivery lorries and purchasing cars second hand from retail punters to compete head on with Cazoo and Cinch, and its focus on smart repairs through its dealerships, I can see more good news to come in the annual report and H1 trading 2022.
I reckon we have another 10-15% SP appreciation to go based on LOOK re-rate.
If you look at the 1 year SP evolution of VTU PDG LOOK. Then both LOOK and PDG are trading at 25% discount to VTU. If we discount PDG (those that know will understand why I do this) and just make the comparison between VTU and LOOK. VTU have returned to dividends earlier and are buying back stock so closing the 25% gap seems unlikely. 10-15% seems more reasonable. So by the FY results, all other things being equal, and divi announcement expect to see LOOK move towards 85p.
Of course there may be a wide sector re-rate or bid or whatever which is not priced in. When MMH were taken out the others barely budged so the market priced this as a one off.
I don't see a Cazoo as a buyer. More likely they would look to a Motorpoint or similar IMO which comes with no OEM hassle.
Yes it is probably that new transit centre, new lorry delivery fleet and investment into sales channels etc. They appear to be gearing up for the future very well presently, and hopefully now back on the front foot to lead the market, after being in a very bad position over the last 5 years under the old CEO and chairman, who sat on their laurels.
Thanks red wine day. I have this morning found on AM-online an article published yesterday titled, Lookers opens new Ford Transit Centre in Colchester. Perhaps that could explain the reduction in nett cash.
2 things
1, Cash position at the end of a plate change month will always be better than non plate change month.
2, You need to look at the variance in the cash position YoY. Q3 variance was 55m Q 4 variance was 48m. So vs the previous year it’s 8m worse. It’s not great but not dramatic and could be explained by any number off things.
At the interim results nett cash was stated as 33m, three months later end of September 30m and today at December end 8m. Apart from the 4.1m returned to the government I am at a loss without final accounts to understand the large reduction in nett cash. Surely cash in transit does not account for the difference. Anybody able to throw some light on this.
Patience! They haven't yet said how big a divi yet. Private equity is one possibility or maybe Cazoo if their plan doesn't quite work out. But - we'll be much better off if the shares creep beyond £1 before a buyer appears and offers a decent premium.